SunCom reaches deal to reduce debt, pursues ‘strategic alternatives’

Regional wireless operator SunCom Wireless Holdings Inc. has reached an agreement with its bondholders to reduce its debt, and also hired a company to advise it on its options, including a possible sale.
SunCom’s stock was de-listed from the New York Stock Exchange in mid-December because the company had not consistently met the exchange’s requirement for a market capitalization of at least $100 million. The stock, under the ticker symbol SWSH, is now traded over the counter. The company has said it will appeal the de-listing.
In the meantime, the company made an agreement with bondholders who own more than 91 percent of some of its notes, to exchange the notes for about 87 percent of SunCom’s common stock. The exchange will be completed in the second quarter of 2007, subject to regulatory conditions and shareholder approval. The deal will reduce SunCom’s debt by nearly $680 million and its annual interest payments by about $62 million. The company also made a deal to sell its 69 U.S. towers to SBA Communications Inc. for $18 million, and now will rent the towers instead of owning them; that transaction is expected to close in the first quarter.
SunCom also hired Goldman, Sachs & Co. as its advisor on the pursuit of “strategic alternatives, including the potential sale of substantially all of its business,” the company said.
SunCom, which previously operated as an AT&T Wireless Services Inc. affiliate under the Triton PCS name, has struggled following Cingular Wireless L.L.C.’s acquisition of AWS in late 2004 and subsequent agreement with Cingular to end its affiliate arrangement.