Regional wireless operator MetroPCS Communications Inc. attracted $600 million in private-equity funding from Madison Dearborn Partners L.L.C. and TA Associates as part of a $739 million minority equity investment in the carrier. MetroPCS said it will use a portion of the proceeds to fund network expansion into new markets, including Dallas and Detroit, with the majority of the proceeds paid to certain existing stockholders to purchase their stock.
Dearborn Partners and TA Associates both contributed $300 million in funding.
“We are pleased that TA Associates and Madison Dearborn have made this investment in MetroPCS,” said Roger Linquist, president and chief executive officer of MetroPCS. “It will allow us to provide liquidity to certain of our investors, many of whom have had a substantial investment in the company for many years.”
MetroPCS, which said it serves more than 1.5 million customers, reported earlier this year that it had awarded a three-year infrastructure contract to Lucent Technologies Inc. to build CDMA-based networks in Dallas, Detroit and Tampa/Sarasota, Fla. The contract was valued at up to $500 million. MetroPCS launched the Tampa/Sarasota market last month joining its previously launched markets in south Florida, Atlanta, San Francisco and Sacramento, Calif.
MetroPCS also picked up six new spectrum licenses earlier this year for $293.6 million through its bidding partner Royal Street Communications L.L.C. during the Federal Communications Commission’s Auction 58.
MetroPCS pulled a planned initial public offering last year due to accounting issues. MetroPCS is not new to financial uncertainty as its previous incarnation as General Wireless Inc. was one of the first companies to file for bankruptcy protection following its participation in the Federal Communications Commission’s initial auction of PCS licenses. GWI eventually emerged from bankruptcy protection having reduced its debt to the FCC from more than $1 billion to $166 million.
