Fitch Rates AT&T Wireless' Proposed Senior Notes `BBB'.Business Editors CHICAGO--(BUSINESS WIRE)--Feb. 26, 2001 Fitch assigns a `BBB' rating to AT&T Wireless Services, Inc.'s (AWS AWS Amazon Web Services AWS American Welding Society AWS Advanced Warning System AWS Advanced Wireless Services AWS Automatic Weather Station AWS Alien Workshop (skateboard company) AWS Austria Wirtschaftsservice GmbH ) proposed $4- 5 billion 144A senior notes issuance with registration rights. The notes will have expected tranches Tranches A piece, portion or slice of a deal or structured financing. This portion is one of several related securities that are offered at the same time but have different risks, rewards and/or maturities. "Tranche" is the French word for "slice". of 5,10, and 30 years. The proceeds of this offering will be used to execute its strategy of expanding network capacity, enlarging its footprint, creating an advanced mobile Internet Refers to gaining access to the Internet using a lightweight, handheld device. See Mobile IP, PDA, smartphone and mobile TV. , and investing in other growth initiatives, as well as, satisfying intercompany obligations. The Rating Outlook for AWS is Stable. The rating reflects the company's strong quantitative credit protection measures and solid industry position. Additionally, the rating provides significant financial flexibility for AWS to pursue strategic initiatives. An important additional consideration is management remains committed to maintain a strong and stable rating going forward. Fitch acknowledges AWS' position as one of the fastest growing wireless operators with a large high-value subscriber base, competitive nationwide offering, and a rich spectrum portfolio with a global mainstream technology path to 3G. Projected industry growth rates Growth Rates The compounded annualized rate of growth of a company's revenues, earnings, dividends, or other figures. Notes: Remember, historically high growth rates don't always mean a high rate of growth looking into the future. will allow AWS to significantly increase its subscribers since 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. has a lower subscriber penetration and thus greater growth potential when compared to European markets. Additionally, due to the network size and number of subscribers, AWS can be considered an operator of scale, which affords it the ability to grow EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become at rates greater than revenue. While AWS will invest billions of dollars in capital expenditures for advanced data services over the next three years, its an investment that is required to remain competitive in this industry. AWS' current spectrum portfolio, along with the Alaska Native Wireless partnership, provides it the luxury of sufficient spectrum in 88 of the top 100 markets for deploying advanced 3G services. In addition, by changing its technology choice from TDMA (Time Division Multiple Access) A satellite and cellular phone technology that interleaves multiple digital signals onto a single high-speed channel. For cellular, TDMA triples the capacity of the original analog method (FDMA). to GSM/UMTS, AWS joined other global operators in choosing an emerging mainstream standard. This choice should offer greater economies of scale, global roaming, and increased handset choices for consumers. The DoCoMo relationship offers great expertise in deployment of data strategies and technology while giving AWS a needed capital investment to fund its operational strategies. |
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