November 23, 2004

Alamosa Holdings made an unsolicited bid for AirGate PCS, an offer AirGate says it is considering. At one point this morning, Alamosa shares were up nearly 13 percent, while AirGate shares jumped 23 percent.

AirGate first received a merger proposal from Alamosa on Oct. 22, but Alamosa said it decided to go public with the details of the plan because it was not being given 'serious' consideration.

AirGate struck back, however, saying: 'We are hereby advising shareholders that in our continuing effort to maximize shareholder value, our Board of Directors is giving this proposal serious consideration, as we do with any matters of this nature.'

Under the terms of the bid, Alamosa is proposing AirGate shareholders receive 2.8 Alamosa shares for each AirGate share, making the deal worth about $355 million.

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In its letter to AirGate PCS CEO Thomas Dougherty, Alamosa said a 'a merger of our two companies would create the premier Sprint PCS affiliate,' with over 23 million total POPs, over 18 million covered POPs and approximately 1.188 million subscribers.

The letter went on to say that Alamosa believes a combined company would reap 'meaningful operational and financial benefits.'

AirGate has hired a financial advisor and said it is reviewing all of its strategic alternatives.

Alamosa's offer is set to expire on Dec. 6, unless the companies are engaged in 'substantial and meaningful negotiations,' Alamosa said.

Source: Wireless Week

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