S&P rates AAT loan B-

Standard & Poor's said it assigned its B- corporate credit rating to AAT Communications Corp. In addition, the company's proposed $325 million senior secured credit facility has been assigned a B- bank loan rating and a recovery rating of 3.

The outlook is stable.

S&P said ratings reflect AAT's significant leverage, expectations of continued opportunistic acquisitions, and relatively small size compared to most of its rated peers. AAT's leverage, which was about 5.67x debt to annualized post-management fee EBITDA pro forma for the refinancing at the end of first-quarter 2004 (about 6.13x after adjusting for operating leases), is mainly the result of the company's debt-financed acquisition of more than 1,250 towers from wireless carriers and other tower operators since mid-2002.

Somewhat tempering these concerns are solid tower industry fundamentals. The tower industry is expected to benefit from continued growth of the wireless industry, driven by a combination of additional subscriber penetration and increasing minutes of use.

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