SpectraSite starts talks on restructuring debt, to miss coupon

New York, Sept. 16 - SpectraSite Holdings, Inc. said it has begun discussions with holders of its senior notes on a balance sheet restructuring.

As part of the move, the Cary, N.C. wireless tower operator said it will not pay the $10.8 million of interest due Sept. 16 on its 10¾% senior notes.

"After lengthy discussions with our financial advisor, Lazard Freres, we have determined that this restructuring initiative is the best option for the company to ensure its long term financial health and success," said Steve Clark, SpectraSite's president and chief executive officer, in a news release. "We can no longer support a level of debt that was incurred in an operating environment that was drastically different than today. Over the last year we have seen the collapse of the telecommunications industry, a significant tightening of the capital markets and an economic recession not experienced in over a decade. All of this has impacted spending by the wireless carriers."

SpectraSite said the restructuring is not expected to affect its operating subsidiary SpectraSite Communications, Inc. or that unit's $1.1 billion senior credit facility. Following a recent amendment to the facility, a payment default on the notes will not cause a default on the credit facility.

SpectraSite said the proposed restructuring would leave all current leases with customers and property owners intact.

The restructuring is expected to "adversely affect" holders of SpectraSite's common stock.

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