SBA Communications gets commitment for $195 million credit facility

By Sara Rosenberg

New York, April 29 - SBA Communications Corp. received a commitment for a new $195 million credit facility that matures on Dec. 31, 2007 from GE Structured Finance (GESF) and affiliates of Oak Hill Advisors, Inc.

The facility will not be syndicated, a source close to the deal told Prospect News.

The facility consists of a $95 million term loan and a $100 million revolver, both bearing interest at a rate of Libor plus 400 basis points. Additional interest of 3.5% per annum will also accrue but not be payable until maturity.

The revolver will convert to a term loan no later than June 30, 2004.

Amortization of borrowed amounts will begin in 2004, at 1% in 2004 and 15% in each of 2005, 2006 and 2007.

Security is a first lien on substantially all of the company's assets.

Proceeds will be used to refinance SBA Telecommunications, Inc.'s existing senior credit facility, which currently has $255 million outstanding. Cash on hand and proceeds from the first closing of SBA's previously-announced sale of towers to AAT Communications Corp. will also be used to help repay the existing facility in full.

The facility is expected to close in conjunction with the first stage of SBA's pending tower sale to AAT.

"Earlier this month we announced the successful amending of our existing senior credit facility. Today, we are pleased to announce a commitment to refinance that facility," commented Jeffrey A. Stoops, president and chief executive officer, in a news release.

"While we were certainly pleased to obtain the amendment, the size of the existing facility would be reduced to $120 million after the sale of all 801 towers to AAT. The new facility will provide us with the availability of up to $195 million after the sale of all 801 towers, more permitted uses of our capital, a longer maturity and more favorable covenants than our amended existing credit facility. With the new facility, we will have more flexibility to proactively manage our balance sheet and expect to have ample liquidity to allow us to attain sustained positive free cash flow."

SBA is a Boca Raton, Fla. owner and operator of wireless communications.

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