BEDMINSTER, NJ — Verizon Wireless, the nation's largest wireless service provider, today announced it signed an agreement with Northcoast Communications LLC, to purchase 50 PCS licenses and related network assets, for approximately $750 million in cash. The licenses cover large portions of the East Coast and Midwest, including such major markets as New York, Boston, Minneapolis, MN, Columbus, OH, Providence, RI, Rochester, NY and Hartford, CT. The cash transaction is expected to close during the second quarter of 2003.
Of the gross proceeds, approximately $60 million will be used to retire the Northcoast FCC related debt. The balance of the proceeds will be distributed to Northcoast's partners, which are comprised of Northcoast PCS and a subsidiary of Cablevision Systems Corporation. Cablevision plans to use its share, approximately $635 million, to pay down bank debt.
Denny Strigl, president and CEO of Verizon Wireless said: "Radio spectrum is the lifeblood of our industry. With additional spectrum we can continue to provide high-quality service even as we develop and deploy new services that our customers require. These highly attractive licenses, overlapping some of our most densely populated service areas, will enable us to efficiently deploy capital to provide more network capacity. As we meet the strong demand for voice services and look forward to the continued growth in our new data and information services like Get It Now, this spectrum comes at the right time and in the right places. "
John Dolan, founder and CEO of Northcoast Communications LLC said: "Located in a number of very attractive markets, we knew that these licenses were valuable assets when we purchased them and believe that Verizon Wireless is uniquely qualified to realize the benefits of this important capacity."
Cablevision President and CEO James L. Dolan said: "As part of our growth plan, we continue to deliver on our commitment to maximize the value of our non-core assets. Northcoast Communications has proven to be an excellent investment for Cablevision. We still believe that there is huge potential in wireless and expect that the use of these licenses will be very fruitful for Verizon Wireless."
Verizon Wireless said it would fund the purchase drawing upon an existing inter-company loan facility with Verizon Communications. Additionally, network investment for increased capacity has been factored into the company's near-term capital program.
Bear Stearns and JPMorgan acted as financial advisors to Northcoast Communications, LLC on this transaction.
Total population (POPS) served by the licenses is approximately 47.4 million and includes 10 MHz in each of the 50 U.S. markets, in the D, E, and F blocks of the 1900 MHz frequency band. They cover a portion of Ohio and New York State, including New York City; the states of Connecticut, Rhode Island and Massachusetts; portions of Maine; Minnesota, including Minneapolis; New Hampshire; Vermont; Pennsylvania; West Virginia and Kentucky. [See state-by-state table for complete list of all 50 markets.]
Also included in the transaction are more than 300 cell site locations that are available for the company to build out its network.
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About Northcoast Communications, LLC
Headquartered on Long Island, NY, Northcoast Communications LLC holds licenses to provide wireless personal communications services in 56 markets, including New York City, Boston, Minneapolis and Cleveland. Northcoast currently offers commercial service in Cleveland, providing the latest in digital wireless service and technology.
About Cablevision Systems Corporation
Cablevision Systems Corporation is one of the nation's leading entertainment, media and telecommunications companies. In addition to its broadband, cable, Internet and telephone offerings, the company owns and operates Rainbow Media Holdings, Inc. and its networks; Madison Square Garden and its teams; and, THE WIZ. In addition, Cablevision operates New York's famed Radio City Music Hall. Additional information about Cablevision Systems Corporation is available on the Web at www.cablevision.com.
About Verizon Wireless
Verizon Wireless is the nation's leading provider of wireless communications. The company has the largest nationwide wireless voice and data network and 31.5 million customers. Headquartered in Bedminster, NJ, Verizon Wireless is a joint venture of Verizon Communications (NYSE:VZ) and Vodafone (NYSE and LSE: VOD). Find more information on the Web at www.verizonwireless.com.
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