SunCom headed toward bankruptcy or a buyout?

[ComicalMoodyDan]

Suncom Wireless hires advisor, suspends guidance
Thu Jan 19, 2006 04:00 PM ET

NEW YORK, Jan 19 (Reuters) - SunCom Wireless Holdings Inc. said on Thursday it would miss earlier fourth quarter earnings estimates and has hired an advisor to evaluate its options for improving its financial condition.

The wireless service provider also said it would not give any type of guidance for future results citing "the unpredictable nature" of its business due to the integration of properties acquired from Cingular Wireless, a venture of AT&T Inc. and BellSouth.

It said it expects to post a fourth quarter loss of $14 million before interest, tax, depreciation and amortization compared to its earlier estimate for a profit of $5 million to $10 million.

SunCom said it had retained Lazard Freres & Co to act as its financial advisor and hired Weil, Gotshal & Manges as a legal advisor.

Its shares fell 45 cents, or more than 16 percent, to $2.33 on the New York Stock Exchange.

http://yahoo.reuters.com/financeQuot...9346666_newsml

[cryogenic]

their hiring of both a financial advisor and a legal advisor... along with saying they basically won't be predicting performance anymore is particularly telling. They're not doing so well and hopefully somebody (T-Mo?) will scoop them up and rescue their customers from such a horribly mismanaged company.

[ZaphodB]

They hired Lazard. Nuff said. It'll be on the chopping block ere the leaves come back to the trees.

[cryogenic]

I knew nothing of Lazard specifically but I found the fact that they hired both a legal advisor and a financial advisor at the same time to be particularly telling. I'm sure they have absolutely every intention of selling ASAP to anyone who'll fork over the coin (which at this point wouldn't be much coin). Perhaps WA should take up donations and buy Suncom ourselves! (kidding, of course)

[Matt]

TM just waiting like a vulture for the right price (hopefully!)

[Matt]

Here's their SEC filing. I don't think they are headed towards BK though

http://biz.yahoo.com/e/060119/tpc8-k.html

[agentHibby]

Well they do have some problems, but they are not to point they have to claim file chapter 12 yet.

The churn is going down 2.1% it was like 4% two years ago.

[ZaphodB]

Matt: does T-Mo have the cap room to buy Suncom? I thought they were busy sending anything they had back to Germany to prop up the less-profitable ventures of the mother ship.

cryogenic, when you hire Lazard Frères you're either preparing for an IPO or a buyout. Since Suncom (TPC) is already a publicly-traded firm, that leaves only one option.

[Jay2TheRescue]

Originally Posted by ZaphodB Matt: does T-Mo have the cap room to buy Suncom? I thought they were busy sending anything they had back to Germany to prop up the less-profitable ventures of the mother ship. cryogenic, when you hire Lazard Frères you're either preparing for an IPO or a buyout. Since Suncom (TPC) is already a publicly-traded firm, that leaves only one option.

There's rumors about TMO buying all the small carriers. I saw in another post earlier today that TMO was rumored to buy Alltel. TMO isn't going to buy all these regional carriers.

[Matt]

Originally Posted by ZaphodB Matt: does T-Mo have the cap room to buy Suncom? I thought they were busy sending anything they had back to Germany to prop up the less-profitable ventures of the mother ship.

DT can pay for it. It's only a couple of billion

TM is paying down some of their debt - $500M (of $16B) paid in Q3 IIRC.

[ComicalMoodyDan]

Look at the law firm that SunCom hired. They have a big office in Germany where T-Mobile is located. One area that the Germany branch focuses on is mergers & acquisitions.

Nominated as "Law Firm of the Year in Germany" - Juve Awards 2004

Located in Germany's finance and commerce capital, the Frankfurt office works closely with our worldwide network of offices to facilitate a variety of cross-border transactions on a seamless basis. Practice areas of this office focus on mergers & acquisitions, private equity, restructuring, capital markets, general corporate, finance, structured finance, tax, corporate real estate and litigation/regulatory.

http://www.weil.com/wgm/pages/Contro...=Frankfurt&d=0

[vger]

Originally Posted by TNDan21 Look at the law firm that SunCom hired. They have a big office in Germany where T-Mobile is located. One area that the Germany branch focuses on is mergers & acquisitions. Nominated as "Law Firm of the Year in Germany" - Juve Awards 2004 Located in Germany's finance and commerce capital, the Frankfurt office works closely with our worldwide network of offices to facilitate a variety of cross-border transactions on a seamless basis. Practice areas of this office focus on mergers & acquisitions, private equity, restructuring, capital markets, general corporate, finance, structured finance, tax, corporate real estate and litigation/regulatory. http://www.weil.com/wgm/pages/Contro...=Frankfurt&d=0

I'd say this is pretty telling. I hope it happens, I'm so sick of SunCom! They should have died a long, long time ago.

[bobolito]

I really hope it does happen! T-Mo really needs to buy Suncom and put them out of their misery. I hope T-Mo buys Dobson as well. They are also falling apart.

[WirelessBeachBum]

This would be nice...Sprint...Nextel...merger has already eliminated one carrier in my area...T-mobile...Suncom merger could eliminate another...

Someone needs to make Hargray Wireless an offer...I think they would take anything just to get out of the prepay business.

[cryogenic]

Perhaps if T-mo bought Suncom they'd go ahead and launch service here in Knoxville alongside the changeover of all the Suncom markets. I wouldn't mind seeing that.

[roamer1]

Originally Posted by cryogenic Perhaps if T-mo bought Suncom they'd go ahead and launch service here in Knoxville alongside the changeover of all the Suncom markets. I wouldn't mind seeing that.

I still don't understand why they haven't already, especially given that the only other GSM carrier in Knoxville is Cingular and given the serious deterioration of the relationship between T-Mobile and Cingular (which is blatantly obvious given the almost total lack of 850 roaming on Cingular, even in areas like west TN where T-Mobile has little coverage, yet nearly unrestricted 850 roaming on nearly all other US GSM carriers) over the past couple of years. I'm starting to think maybe T-Mobile has actually been waiting to buy SunCom before building out Knoxville...

-SC

[cryogenic]

Dan and I have had this discussion several times and we both think basically the same thing. Sounds to me like they're waiting to buy out Suncom so they can turn up everything all at once. At that point, they'll have Knoxville & Tri Cities both online at the same time to connect to their Chattanooga & Nashville systems plus they'll have southwest VA along with NC & SC all online at the same time, basically completing their southeast coverage in one fell swoop. It doesn't seem unfathomable that they'd do this. It almost makes me think that they were planning this all along, even since the Powertel days... Perhaps they had intended on acquiring some NC & SC spectrum before this but it must have gotten pushed to the back burner. Now Suncom is clearly making themselves available and T-mo may be jumping on this in short order.

[djjim]

It seems like a simple fix....when you do not have the greatest network to begin with and your customer service is poor you need to offer the customer something more. Give them a reason to come to your company. What do they offer now? The unplan is the only attractive offer but the expensive adders turn away families like mine. Taxes and fees included, that's nice and all, but it's built in to their already expensive plans. An example would be the 600 minute national plan, 2 lines for 65 dollars. Guess what? Nights and weekends are not included. That's an extra 10 dollars. So now we are at 75 bucks for 2 lines with unlimited n&w and 600 anytime minutes. By comparison for similar plans:

Vzw 69.99 100 more minutes, great c.s., great network
Cingular 69.99 100 more minutes, rollover, option for 7:00 n&w
Alltel 75.00 300 more minutes, n&w at 7:00 included, good c.s.
Sprint 69.99 200 more minutes, fair & flexible, n&w at 7:00 available.

Why on earth would anyone want Suncom? They need to make their plans more attractive and improve c.s. or they will continue sinking! Even their local plans are not competetive enough. Suncom plans are not attractive to business people or families. IMHO, the only consumer that would migrate to Suncom is one who doesn't travel much and is looking to replace his landline with the Unplan. Does this sound like the recipe for success to you????

[cryogenic]

I think at this point they may be trying to boost ARPU for the impending buyout.