Recovery Prospects are Substantial for Secured Debt of Regional Wireless Carriers

Recovery prospects are likely to be substantial for the senior secured debt of U.S. regional wireless carriers despite the sector's generally weak credit profile, Standard & Poor's Ratings Services said today in a report.

"This is because wireless carriers generally have excellent value retention characteristics and could in a distress situation be sold or reorganized," said Standard & Poor's credit analyst Naveen Sarma. Company valuations reflect such factors as the scarcity of wireless spectrum licenses, high barriers to entry in a capital intensive business, and significant growth prospects in an increasingly mobile world.

The report, "Regional Wireless Carriers - Solid Valuations Underpin Secured-Debt Recovery Prospects," focuses on $6.3 billion of rated secured bank debt at American Cellular Corp., Centennial Communications Corp., Cricket Communications Inc., Dobson Cellular Systems Inc., iPCS Inc., MetroPCS Wireless Inc., Rural Cellular Corp., and SunCom Wireless Inc.

Posted to the site on 5th November 2007