SAN DIEGO -- December 2, 2003 -- Qualcomm Incorporated (Nasdaq: QCOM), pioneer and world leader of Code Division Multiple Access (CDMA) digital wireless technology, today announced the closing of the transaction in which Embratel Participadões S.A. acquired from Qualcomm its indirect controlled operating subsidiaries, Vésper S.A and Vésper São Paulo S.A. (Vésper), together with their immediate holding companies Vésper Holding S.A. and Vésper Holding São Paulo S.A. As part of this transaction, Qualcomm has retained, through a newly formed indirect controlled subsidiary (TowerCo), ownership and control of Vésper's existing 622 communication towers and related interests in tower site property leases.
Concurrent with the closing of the transaction, Vésper and TowerCo entered into a 10-year agreement (renewable at Vésper's option for up to two successive five year terms) whereby Vésper will pay a monthly fee for use of aerial and ground space on the tower sites.
Qualcomm expects that TowerCo's extensive network of tower sites will be attractive to other parties who are interested in gaining access to these sites via similar usage rights arrangements -- particularly in the key markets of São Paulo and Rio de Janeiro where operators' ability to secure and build new tower sites is often challenging. Under the tower usage arrangement, Qualcomm preserves the ability, and plans, to sell some or all of its interest in TowerCo and/or the tower sites directly (with assignment of the associated rights under the usage rights agreement).
"This transaction is a positive strategic move for all parties involved," said Anthony S. Thornley, president and COO of Qualcomm. "Embratel's financial strength, Brazilian telecom expertise, and ability to realize significant synergies from its existing operations will help Vésper enhance its voice and data service offerings. In particular, we are encouraged by Embratel's plans to extend and expand Vésper's position in Brazil's high-speed broadband Internet access market as it grows Latin America's first, and largest, 3G CDMA 1xEV-DO network. Furthermore, we are excited about Embratel's ability and plans to expand CDMA's market position as the dominant wireless access technology within Brazil."
Qualcomm Incorporated (www.qualcomm.com) is a leader in developing and delivering innovative digital wireless communications products and services based on the Company.s CDMA digital technology. Headquartered in San Diego, Calif., Qualcomm is included in theS&P500 Index and is a 2003 FORTUNE 500® company traded on The Nasdaq Stock Market® under the ticker symbol QCOM.
Except for the historical information contained herein, this news release contains forward-looking statements that are subject to risks and uncertainties, including the Company's ability to successfully design and have manufactured significant quantities of CDMA components on a timely and profitable basis, the extent and speed to which CDMA is deployed and market position expanded or maintained,, change in economic conditions of the various markets the Company serves, as well as the other risks detailed from time to time in the Company's SEC reports, including the report on Form 10-K for the year ended September 28, 2003, and most recent Form 10-Q.