Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Leap Wireless International (LWIN) -- Ignore unavailable to you. Want to Upgrade?

To: KaiserSosze who wrote (305)	4/20/1999 6:47:00 PM
From: Nancy Haft	Read Replies (1) \| Respond to of 2737

Tuesday April 20, 6:25 pm Eastern Time Leap Wireless seeks partner for Chile PCS network SANTIAGO, April 20 (Reuters) - U.S.-based wireless communications carrier Leap Wireless International, Inc. (LWIN - news) on Tuesday said it is looking for a partner to help develop its Chilesat PCS Chilean wireless carrier. ''We are looking for a Chilean partner or investor who knows the market,'' Daniel Pegg, senior vice president of public affairs at Leap, told reporters. On Tuesday, Leap, of San Diego, Calif., closed a deal in which it increased its ownership of Chilesat Telefonia Personal SA (Chilesat PCS) to 100 percent from 50 percent for $50 million. It purchased the stake from Chilean telecommunications concern Telex-Chile (TL - news) and its affiliate Chilesat SA. Leap paid about $42 million for the original 50 percent, which it purchased in the mid-1990s, Pegg said. By no means is Leap desperate for a partner, he said. ''We bought the other half of the company knowing we may have to carry it for some time,'' he said. ''If we don't find someone, our resources will be able to sustain the operation.'' Initially, the partner would have ''a small percentage,'' and Leap would retain control, Pegg said. ''We would want to reserve the rest to sell at a future date,'' he said, explaining that later Leap might add even more investors to Chilesat PCS and hand them more than 50 percent. The initial partner would not need to be a telecom operator, but it would need to possess the ''financial capacity to carry (its) percentage of the project,'' he said. Leap has not spoken with any possible candidates yet, not even Chilean holding company Quinenco (LQ - news) , Pegg said. Market watchers speculate that Quinenco, which is run by Chile's Luksic family, could turn to the telecom sector as a destination for the large wad of cash that it soon will have in its hands. Quinenco plans to sell its 50 percent in financial holding O'Higgins Central Hispano (OHCH) for $600 million, which would generate a $300 million net profit. Quinenco used to have interests in Chilean telecom firm VTR, and it currently owns a small stake in Entel , the country's leading long-distance carrier. With Leap's acquisition of Chilesat PCS, a new era has begun for the latter, Pegg said. Chilesat PCS launched commercial services in September 1998, and although demand for the service was strong, it experienced short-term funding problems because of Telex-Chile's debt burden, Pegg said. On Friday, however, Telex said it reached an agreement with lender banks to put an end to its long-standing financial problems. Leap plans to recapitalize Chilesat PCS, which would allow it to go ahead with an expansion of the network and services. Chilesat PCS' nationwide wireless network covers 85 percent of the country's population and has 28,000 subscribers, Pegg said. Chilesat PCS is revising its investment plan, said its general manager, Richard Sutherland, who accompanied Pegg. Sutherland and Pegg, however, would not disclose a figure for expected investment. In September, Chilesat PCS said it planned to invest $300 million in the next five years. Chilesat PCS is considering changing its name, and it plans to launch a new advertising campaign, Sutherland said, adding that it will not start a price war. Leap, which also has all-digital wireless services in the United States, Mexico and Russia, hopes to launch a service in Australia this year, Pegg said.

To: KaiserSosze who wrote (305)	4/20/1999 6:56:00 PM
From: Nancy Haft	Respond to of 2737

Tuesday April 20, 4:31 pm Eastern Time Company Press Release SOURCE: Leap Wireless International, Inc. Leap Wireless International Closes Acquisition of 100% of Chilesat PCS, Commits to Investment in the Promising Wireless Carrier - Long Term, Leap to Seek Strategic Chilean Equity Partner - SANTIAGO, Chile, April 20 /PRNewswire/ -- Wireless communications carrier Leap Wireless International, Inc. (Nasdaq: LWIN - news) today announced it has closed its acquisition of 100% of Chilesat Telefonia Personal S.A. (Chilesat PCS). Leap also committed to further investment to spur the growth of the nationwide wireless carrier. The first of that investment has been made simultaneously with the acquisition. Leap's investment is expected to re-energize sales and marketing efforts, expand network capacity, and aggressively grow the business. Chilesat PCS launched commercial service in September 1998 and had approximately 27,000 subscribers as of Feb. 28, 1999, the end of Leap's second quarter of fiscal 1999. In a $50 million transaction, Leap has purchased the remaining 50% of Chilesat PCS from Telex-Chile, a Chilean telecommunications company, and its affiliate, Chilesat S.A. The transaction is structured with a $28 million cash payment and a deferred payment obligation of $22 million. ''We believe in the potential of the Chilean wireless market and the role of Chilesat PCS in its growth,'' said Harvey P. White, chairman and CEO of Leap. ''As owner of the company, Leap can more effectively provide its management, technical, deployment and financial expertise to make the network a success. Over the long term, Leap anticipates bringing one or more additional equity partners into the venture. In particular, we will seek a strategic Chilean equity partner because we view Chilesat PCS first and foremost as a strong Chilean company.'' ''Leap's immediate and future investments in Chilesat PCS are excellent news for our existing and future customers,'' said Richard Sutherland, general manager of Chilesat PCS. ''Now Chilesat PCS will be able to meet the extraordinary demand for high-quality wireless service.'' At 6.5% wireless penetration, the fast growing Chilean wireless market is poised for more impressive growth due to the introduction of Calling Party Pays billing in February 1999. About Leap Wireless International Leap Wireless International, Inc., headquartered in San Diego, California, is a wireless communications carrier that deploys, owns and operates wireless networks in domestic and international markets with strong growth potential. In conjunction with its strategic partners, Leap has launched all-digital wireless networks in Chile, the United States, Mexico and Russia, and plans to offer service Australia through its operating companies. Leap is dedicated to bringing the benefits of reliable, cost-effective and high-quality voice and data services to domestic and emerging markets. For more information, please visit www.leapwireless.com. This news release contains certain ''forward-looking statements,'' including statements regarding the future investment in and growth of the Chilesat PCS network. Forward-looking statements, which are based upon certain assumptions and describe future plans, strategies and expectations of the Company, are generally identifiable by use of the words ''believe,'' ''expect,'' ''intend,'' ''plan,'' ''anticipate,'' ''estimate,'' ''project'' or similar expressions. The ability of the Company to predict actual results and other future events is inherently uncertain. Important factors which may cause actual results to differ materially from the forward-looking statements contained herein or in other public statements by the Company are described in the section entitled ''Risk Factors'' in the Company's 1998 10-K, most recent 10-Q and other documents on file with the Securities and Exchange Commission. Those factors most likely to cause actual results to differ include but are not limited to: the availability of debt and equity capital, international market risks, currency fluctuations, uncertainties relating to costs and profitability of development stage companies, and the substantial leverage of Leap Wireless and its operating companies. SOURCE: Leap Wireless International, Inc.