SpectraSite to file prepackaged Chapter 11

New York, Nov. 6 - SpectraSite Holdings, Inc. said it reached agreement with holders of 66% of its senior notes on a restructuring to be achieved through a prepackaged Chapter 11 filing.

Under the agreement, all the holding company debt will be eliminated and annual interest expense will be reduced by $200 million.

The Chapter 11 filing will only involve SpectraSite Holdings, Inc. The operating company, SpectraSite Communications, Inc., is not included.

The Cary, N.C. wireless tower operator said it does not expect the restructuring to cause a default on or otherwise affect SpectraSite Communications' $1.1 billion senior credit facility.

As part of the proposed restructuring, SpectraSite's $2.0 billion principal amount at maturity of senior notes plus accrued interest will be exchanged for all the common stock of the reorganized company.

Existing stockholders will receive warrants for 5% of the reorganized company's stock with a strike price based on an enterprise value of $1.5 billion.

Options will also be issued to management.

As part of the bankruptcy process, holders of affected claims will be asked to approve the restructuring. SpectraSite said that it expects approval, given that it already has the support of an informal committee representing holders of a majority of the senior notes.

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