OKLAHOMA CITY, Sept. 23, 2004 (PRIMEZONE) -- Dobson Communications Corporation (Nasdaq:DCEL), through its operating subsidiary, Dobson Cellular Systems, Inc., announced today that it has entered into a definitive agreement to acquire the Michigan wireless assets of RFB Cellular, Inc. and certain affiliates in a sale pursuant to Bankruptcy Code section 363. Dobson has agreed to purchase the RFB assets for $26 million, subject to higher offers.
RFB Cellular owns markets in Michigan Rural Service Areas 2 and 4, covering a total population (POPs) of approximately 256,000. RFB operates both CDMA and analog technologies on 850 MHz cellular licenses in these markets. Excluding overlap with markets already served by Dobson, the RFB assets would add 176,000 incremental covered POPs to Dobson service areas in northern Michigan. Newly served areas would include Mackinac Island, Interstate 75 from the Straits of Mackinac to the Canadian border, and the cities of Sault Ste. Marie, Escanaba and Manistique. Dobson currently serves all or portions of Michigan RSAs 1, 3, 4, 5, 6, 7 and 10 in the state, as well as the Muskegan Metropolitan Service Area. Upon completion of the purchase of the RFB assets, Dobson plans to upgrade the former RFB network with GSM/GPRS/EDGE technology.
Dobson is also acquiring RFB's 1900 MHz PCS licenses covering 1.3 million POPs that provide an additional 10 MHz of spectrum in the Traverse City, Petoskey, Saginaw/Bay City, Mt. Pleasant, Alpena, Escanaba and Sault Ste. Marie BTA's.
RFB currently serves approximately 24,000 subscribers, approximately 95 percent of whom are on postpaid calling plans. RFB has eight retail stores marketed under the CellularOne brand name and eight dealer agreements in the region. RFB's wireless network includes 73 cell sites locations, of which 38 are company-owned.
Along with the value of RFB's current business and assets, Dobson noted that the increased coverage footprint in Michigan would enhance the value of calling plans that Dobson sells in the state and would enable the Company to reduce the expenses that its subscribers incur when they roam statewide.
Dobson said that it plans to fund the purchase primarily with borrowings under its bank credit facility. If the bankruptcy court approves the transaction, Dobson expects to complete it by the end of the year.
About Dobson Communications
Dobson Communications is a leading provider of wireless phone services to rural markets in the United States. Headquartered in Oklahoma City, the Company owns wireless operations in 16 states, with markets covering a population of 11.4 million. The Company serves 1.6 million customers. For additional information on the Company and its operations, please visit its Web site at http://www.dobson.net.
This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These include, but are not limited to, statements regarding Dobson's plans, intentions and expectations. Such statements are inherently subject to a variety of risks and uncertainties that could cause actual results to differ materially from those projected. These risks include, but are not limited to, gaining regulatory approval for its acquisition in Michigan. A more extensive discussion of the risk factors that could impact these areas and Dobson's overall business and financial performance can be found in Dobson's reports filed with the Securities and Exchange Commission. Given these concerns, investors and analysts should not place undue reliance on forward-looking statements.