S&P upgrades SpectraSite

Standard & Poor's said it raised its ratings on SpectraSite Inc. and its related entities. The corporate credit rating was raised to B+ from B. The rating on SpectraSite Communications Inc.'s bank loan was raised to BB- from B+, and a recovery rating of 1 was assigned to the bank loan.

The rating on SpectraSite's senior unsecured debt, which was raised to B- from CCC+, is two notches lower than the corporate credit rating due to the large amount of bank debt in the capital structure relative to the company's overall asset base.

The outlook is positive.

S&P said the upgrade reflects the company's successful track record of consistently increasing operating cash flows from SpectraSite's wireless tower business since February 2003, when the company emerged from bankruptcy. This has translated into ongoing improvement in its financial profile.

Despite the near-investment-grade business risk of SpectraSite's relatively protected tower leasing operations, S&P noted credit quality is tempered by an aggressive financial policy that includes a tolerance for additional debt that would be used principally to enhance shareholder value and secondarily acquisitions.

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