American Tower Corporation and SpectraSite, Inc. Agree To Merge.BOSTON & CARY, N.C. -- American Tower Corporation Formed in 1995, American Tower Corporation is a publicly held company (NYSE: AMT) that is a leading owner and operator of wireless and broadcast communications sites in North America. Today American Tower owns and operates over 30,000 sites in the United States, Mexico and Brazil. (NYSE NYSE See: New York Stock Exchange :AMT See vPro. ) and SpectraSite, Inc. (NYSE:SSI (1) See server-side include and single-system image. (2) (Small-Scale Integration) Less than 100 transistors on a chip. See MSI, LSI, VLSI and ULSI. 1. (electronics) SSI - small scale integration. 2. ) TRANSACTION HIGHLIGHTS --$11.3 billion transaction brings together tower industry leaders --Combined company to have portfolio of over 22,600 communications sites --Creates North America's premier tower company with over $1.0 billion in annual revenues American Tower Corporation (NYSE:AMT) and SpectraSite, Inc. (NYSE:SSI) announced today an agreement for American Tower to merge with SpectraSite, in a transaction that would bring together two tower industry leaders with a combined portfolio of over 22,600 communications sites. Under the terms of the agreement, which was unanimously approved by the boards of directors of both companies, American Tower and SpectraSite will merge in a stock for stock exchange, in which shareholders of SpectraSite will receive 3.575 shares of American Tower Class A common stock for each common share of SpectraSite. Based on American Tower's closing stock price on May 3, 2005, this exchange ratio equals $61.53 per share, valuing SpectraSite's equity at approximately $3.1 billion. American Tower expects to issue approximately 181.0 million shares in the transaction. Following the closing, American Tower shareholders would own approximately 59% and SpectraSite shareholders would own approximately 41% of the combined company. The transaction is expected to be tax-free to shareholders of both companies for U.S. federal income tax purposes. The transaction, which is subject to approval by shareholders of American Tower and SpectraSite, as well as regulatory approvals and other customary closing conditions, is expected to close in the second half of 2005. "Defining Event" "This combination is a defining event in the tower industry, creating the clear industry leader," said Jim Taiclet, American Tower's Chairman and Chief Executive Officer. "We believe there is a compelling alignment between the strategies of American Tower and SpectraSite. First, we are both fully focused on the tower leasing business. Second, we are both committed to operational excellence, investing continually in our people, processes and systems. And third, we are both committed to delivering superior returns to shareholders as we generate increasing free cash flow over time. Combining with SpectraSite creates an even stronger company, with expanded revenue, decreased leverage for American Tower, a broader customer base and a more numerous and diverse tower portfolio." "The combination of SpectraSite and American Tower will ensure our ability to compete successfully in serving the needs of our customers," said Steve Clark This article is about the late Def Leppard guitarist. For other uses, see Steve Clark (disambiguation). Stephen Maynard Clark (April 23, 1960 – January 8, 1991) was the co-lead guitarist for British rock band Def Leppard until his death in 1991. , President and Chief Executive Officer of SpectraSite. "We will have more towers in the best markets. Together, we will be the premier tower company in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. ." High Quality Assets American Tower and SpectraSite bring together high quality wireless and broadcast tower assets to the combined company. American Tower has a portfolio of over 14,800 communication sites, including approximately 12,400 sites in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. . The addition of SpectraSite's portfolio of approximately 7,800 communication sites will create a combined company with a portfolio of over 22,600 communications sites, including over 22,000 wireless towers and over 400 broadcast towers. The combined company will have over 20,000 tower sites in the Unites States. With over 85% of the company's tower sites located in the 100 top basic trading areas In the US, a Basic Trading Area is a geographic region defined by the FCC where a Personal Communications Service can operate.[1] It consists of the counties surrounding a city designated as the basic trading center. , or "BTA (Business Technology Association, Kansas City, MO, www.bta.org). A membership association of manufacturers, dealers, distributors and service companies in the business equipment and systems industries, founded in 1994. ," markets and core corridors, the company will have a broad and compelling footprint to service its customers. Commitment to Tower Leasing "Together, we are committed to growing the tower leasing business and taking full advantage of the operating leverage Operating Leverage A measurement of the degree to which a firm or project relies on fixed rather than variable costs. Notes: The higher the degree of operating leverage, the greater the potential danger from forecasting risk. of the tower business model," said Taiclet. "Wireless voice subscribers and minutes of use have grown steadily and are expected to continue to grow over the coming years. We believe that as wireless carriers seek to improve coverage and network quality, and deploy next generation voice and data services, we will continue to enjoy robust growth in our business. By bringing together strong management, skilled employees and best practices of both companies, we will be better able to capitalize on Cap´i`tal`ize on` v. t. 1. To turn (an opportunity) to one's advantage; to take advantage of (a situation); to profit from; as, to capitalize on an opponent's mistakes s>. the growth in the wireless industry." "We recognize that towers are an integral part of our customers' business operations Business operations are those activities involved in the running of a business for the purpose of producing value for the stakeholders. Compare business processes. The outcome of business operations is the harvesting of value from assets . As a combined company, we will be able to offer more than 20,000 sites in the US to our customers. And combined with our joint dedication to customer service and continuous process improvement, we believe that our clear scale leadership will enable us to emerge as the preferred provider to wireless carriers nationwide." Financial Expectations American Tower and SpectraSite expect the proposed transaction will yield a net present value in excess of $400 million in synergies. Based on the scalability of the tower business model, the combined company expects to achieve operational efficiencies by spreading its relatively fixed tower operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. over a larger number of towers and broader revenue base. By reducing corporate expense and tower overhead, the combined company believes that it can achieve annual cost synergies Cost Synergy In the context of mergers, cost synergy is the savings in operating costs expected after two companies, who compliment each other's strengths, join. Notes: The savings in operating costs usually come in the form of laying off employees. of approximately $30-35 million per year. The combined company will also have a strengthened balance sheet. American Tower currently has approximately $3.1 billion in total debt and SpectraSite has $750 million. The transaction will decrease American Tower's overall leverage, which will provide the company with greater financial flexibility. American Tower expects the cash flow and financial position of the combined company to accelerate the company's ability to reduce debt levels and return cash to shareholders. Mr. Taiclet will continue to serve as Chief Executive Officer of the combined company and Chairman of the Board of Directors of American Tower following the closing, and Brad Singer will serve as Chief Financial Officer. Mr. Clark will join the American Tower Board of Directors, as will three other members of SpectraSite's Board of Directors, including Tim Biltz, SpectraSite's Chief Operating Officer Chief Operating Officer (COO) The officer of a firm responsible for day-to-day management, usually the president or an executive vice-president. . As a result, the American Tower Board of Directors will increase from six to ten members. The corporate headquarters for the combined company will remain in Boston, Massachusetts “Boston” redirects here. For other uses, see Boston (disambiguation). Boston is the capital and most populous city of Massachusetts.[3] The largest city in New England, Boston is considered the unofficial economic and cultural center of the entire New . Conference Call Information American Tower and SpectraSite will hold a joint conference call today at 11:00 a.m. EST EST electroshock therapy. EST abbr. electroshock therapy to discuss the transaction. Jim Taiclet and Steve Clark will host the call together. The dial-in numbers are US/Canada: (877) 235-9047, International: (706) 645-9644 access code 5629795. Presentation slides will be available on the companies' websites prior to the call. A replay of the call will be available from 12:00 p.m. EST P.M. also p.m. or p.m. abbr. post meridiem Usage Note: By definition, 12 a.m. May 4, 2005 until 11:59 p.m. EST May 11, 2005. The replay dial-in numbers are US/Canada: (800) 642-1687 and International: (706) 645-9291, access code 5629795. American Tower will sponsor a live simulcast of the call on its website, http://investor.americantower.com. When available, a replay of the call will be accessible on the website. About American Tower American Tower is the leading independent owner, operator and developer of broadcast and wireless communications wireless communications System using radio-frequency, infrared, microwave, or other types of electromagnetic or acoustic waves in place of wires, cables, or fibre optics to transmit signals or data. sites in North America. American Tower operates over 14,800 sites in the United States, Mexico, and Brazil, including approximately 300 broadcast tower sites. For more information about American Tower Corporation, please visit our website www.americantower.com. About SpectraSite SpectraSite, Inc. (www.spectrasite.com), based in Cary, North Carolina Cary is the second largest municipality in Wake County, North Carolina and the third largest municipality in The Triangle (North Carolina) behind Raleigh and Durham. It is the seventh largest municipality in North Carolina. , is one of the largest wireless tower operators in the United States. At December 31, 2004, SpectraSite owned or operated approximately 10,000 revenue producing sites, including 7,821 towers and in-building systems primarily in the top 100 markets in the United States. SpectraSite's customers are leading wireless communications providers, including Cingular, Nextel, Sprint PCS (1) (Personal Communications Services) Refers to wireless services that emerged after the U.S. government auctioned commercial licenses in 1994 and 1995. This radio spectrum in the 1. , T-Mobile and Verizon Wireless Cellco Partnership, doing business as Verizon Wireless, owns and operates the second largest wireless telecommunications network in the United States, based on total wireless customers. . Advisors Citigroup Global Markets Inc. was the lead financial advisor to American Tower on the transaction. Credit Suisse First Boston Credit Suisse First Boston was originally the trading name of the Financière Crédit Suisse-First Boston, a London-based 50-50 investment banking joint venture formed in 1978 between the First Boston Corporation and Credit Suisse. also advised American Tower on the transaction. American Tower's principal legal advisor was King & Spalding LLP LLP - Lower Layer Protocol . SpectraSite's financial advisors were Evercore Partners Evercore Partners NYSE: EVR is a boutique investment bank and private equity investment firm located in New York. It was founded by Blackstone Group alumni Austin Beutner and Roger Altman in 1996. Inc. and Lehman Brothers Lehman Brothers Holdings Inc. (NYSE: LEH), founded in 1850, is a diversified, global financial services firm. It is a participant in investment banking, equity and fixed income sales, research and trading, investment management, private equity, and private banking. Inc., and its principal legal advisor was Paul, Weiss, Rifkind, Wharton & Garrison LLP. Cautionary Language Concerning Forward-Looking Statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. Statements in this press release regarding the proposed transaction between American Tower and SpectraSite, the expected timetable for completing the transaction, future financial and operating results, benefits and synergies of the transaction, future opportunities for the combined company and any other statements about American Tower and SpectraSite management's future expectations, beliefs, goals, plans or prospects constitute forward looking statements within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. Such statements are based upon the current beliefs and expectations of American Tower's and SpectraSite's management and are subject to significant risks and uncertainties. Actual results may differ from those set forth in the forward-looking statements. Any statements that are not statements of historical fact (including statements containing the words "believes," "plans," "anticipates," "expects," estimates and similar expressions) should also be considered to be forward looking statements. There are a number of important factors that could cause actual results or events to differ materially from those indicated by such forward looking statements, including: the ability to obtain governmental approvals of the transaction on the proposed terms and schedule; the failure of American Tower and SpectraSite shareholders to approve the transaction; the ability of American Tower to successfully integrate SpectraSite's operations and employees; the risk that the cost savings and any other synergies from the transaction may not be fully realized or may take longer to realize than expected; disruption from the transaction making it more difficult to maintain relationships with customers and employees; competition and its effect on pricing, spending, third-party relationships and revenues. Additional factors that may affect future results are contained in American Tower's and SpectraSite's filings with the Securities and Exchange Commission ("SEC"), including each company's Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the year ended December 31, 2004, which are available at the SEC's website http://www.sec.gov. The information set forth herein speaks only as of the date hereof, and American Tower and SpectraSite disclaim any intention or obligation to update any forward looking statements as a result of developments occurring after the date of this press release. Important Additional Information Will be Filed with the SEC In connection with the proposed transaction, American Tower plans to file with the SEC a Registration Statement on Form S-4 containing a Joint Proxy Statement/Prospectus. INVESTORS AND SECURITY HOLDERS OF AMERICAN TOWER AND SPECTRASITE ARE URGED TO READ THE REGISTRATION STATEMENT AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC, INCLUDING THE JOINT PROXY STATEMENT/PROSPECTUS THAT WILL BE PART OF THE REGISTRATION STATEMENT WHEN THEY ARE AVAILABLE, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT AMERICAN TOWER, SPECTRASITE, THE PROPOSED TRANSACTION AND RELATED MATTERS. The final Joint Proxy Statement/Prospectus will be mailed to shareholders of American Tower and SpectraSite. Investors and securityholders of American Tower and SpectraSite will be able to obtain copies of the Registration Statement and the Joint Proxy Statement/Prospectus, when they become available, as well as other filings with the SEC that will be incorporated by reference into such documents, containing information about American Tower and SpectraSite, without charge, at the SEC's website http://www.sec.gov. These documents may also be obtained for free from American Tower by directing a request to American Tower Corporation, Investor Relations Investor relations The process by which the corporation communicates with its investors. , 116 Huntington Ave, Boston, MA 02116 or for free from SpectraSite by directing a request to SpectraSite, Inc. at 400 Regency Forest Drive, Cary, NC 27511, Attention: Secretary. Participants in Solicitation American Tower, SpectraSite and their respective directors and executive officers and other members of management and employees may be deemed to be participants in the solicitation of proxies from American Tower and SpectraSite shareholders in respect of the proposed transaction. Information regarding American Tower's participants is available in American Tower's Annual Report on Form 10-K for the year ended December 31, 2004, and the proxy statement Proxy Statement A document containing the information that a company is required by the SEC to provide to shareholders so they can make informed decisions about matters that will be brought up at an annual stockholder meeting. , dated April 27, 2005, for its 2005 annual meeting of stockholders, which are filed with the SEC. Information regarding SpectraSite's participants is available in SpectraSite's Annual Report on Form 10-K for the year ended December 31, 2004 and the proxy statement, dated March 31, 2005, for its 2005 annual meeting of shareholders, which are filed with the SEC. Additional information regarding the interests of such participants will be included in the Registration Statement containing the Joint Proxy Statement/Prospectus to be filed with the SEC. |
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