Mesa Finds $85M Oasis

Looking to expand its network of communications towers in the Northeast, Mesa Communications Group LLC last week closed on $85 million worth of new money. The financing included a $75 million senior credit facility and $10 million worth of equity.

Led by BNP Paribas, the bank syndicate also included Tyco Capital, GE Capital and Wachovia Bank. Previous investor Schroder Ventures US Fund exercised its pro rata shares in the round and acted as an internal placement agent to bring in the group of lenders.

The middle-market owner, developer and operator of communications towers intends to use the proceeds from the round to continue building out its wireless communications tower network. Specifically, Mesa will focus on leasing or building towers in Maine and Vermont. The Fall Church, Va.-based company currently owns approximately 200 towers located in the Northeast, Mid-Atlantic and Southeast regions of the U.S.

While owning and operating communications towers is a relatively capital-intensive business, the company expects its latest financing to fully fund its business plan through mid-2003, said Nicholas Somers, a partner with Schroder Ventures US.

The company has not yet determined whether or not it will return to the private market for additional capital down the road, added Mesa President Michael Williams.

Mesa claims it is among the top 10 tower owners in the U.S. Indeed, it shares the space with such firms as publicly traded American Tower Corp. and privately held Irving, Texas-based Trintel Communications Inc., which capped a $50 million Series B round last July. For its part, American Tower owns and operates more than 14,000 sites and 170 satellite antennas in the United States, Mexico and Canada. At the conclusion of its venture round in July, Trintel boasted 400 wireless communications towers and approximately 500 additional towers in build-to-suit or lease arrangements in 25 states.

Nonetheless, Williams said he is not concerned about rubbing competitive elbows with these companies in Mesa’s chosen regions. “Once you get a tower built, for the most part you do not face competition in a general area,” he explained. “Zoning in this country is so difficult, and with the environmental concerns, people don’t like to have multiple towers in a given area. So once you put a tower in place, you generally do not face competition in the area around the tower.”

Founded in March 1999, Mesa is developing a network of clustered community towers designed to accommodate various types of wireless communications providers, including broadband wireless carriers, FM and TV broadcasters and private land mobile radio operators.

Robyn Kurdek can be contacted at:Robyn.Kurdek@tfn.com