Uniti Group Inc. · NASDAQ:UNIT
Uniti — Merger or Acquisition (May 2024)
21 slides from Uniti's merger presentation, May 3, 2024
Slide 1: A Premier Digital Infrastructure Company
A Premier Digital Infrastructure Company May 3 , 2024
Slide 2: No Offer or Solicitation
No Offer or Solicitation This communication and the information contained in it are provided for information purposes only and are not intended to be and shall not constitute a solicitation of any vote or approval, or an offer to sell or solicitation of an offer to buy, or an invitation or recommend
Slide 3: Cautionary Statement
Cautionary Statement 3 Forward - Looking Statements This communication contains forward - looking statements, including within the meaning of the Private Securities Litigation Reform Act of 1995 . Forward - looking statements can often be identified by terms such as “may,” “will,” “appears,” “should
Slide 4: Today's Presenters
Today’s Presenters 4 KENNY GUNDERMAN Chief Executive Officer, Uniti PAUL BULLINGTON Chief Financial Officer, Uniti Transaction Details Strategic Rationale Value Creation Financial Overview Q&A
Slide 5: Transformative Combination Unlocks Significant Value
Transformative Combination Unlocks Significant Value 5 Uniti and Windstream to combine to create a premier insurgent fiber provider with ~$4 billion in revenue and 217,000 fiber route miles covering 47 states within the U.S. Existing Uniti shareholders will own ~62% and existing Windstream sharehold
Slide 6: Transaction terms and consideration to Windstream shareholders
▪ Consideration to Windstream shareholders to include $425 million in cash, $575 million of preferred equity in the new combine d company, and common shares representing ~38% ownership of the outstanding common equity of the combined company (1) • Windstream shareholders will additionally receive no
Slide 7: Combined Company's Assets & Customers Create a Leader in the Fiber Space
Combined Company’s Assets & Customers Create a Leader in the Fiber Space 7 Combined Company Windstream Uniti 4.3 Million Households OpCo PropCo Kinetic ~217,000 ~87,000 ~140,000 National Wholesale Fiber Route Miles (1) 30 to 50 Lit Metros Field Ops (2) 30 Lit Metros Regional Enterprise Leverages Typ
Slide 8: Large and Growing Market with Significant Macro Tailwinds
Large and Growing Market with Significant Macro Tailwinds 8 2004-2008 2009-2013 2014-2018 2019-2023 2024-2028 AI Generation Post Dot - Com Bubble Growth Smart Devices Proliferate ▪ Birth of iPhone ▪ Growth of China digital economy ▪ Online music Internet Monetization New Business Models Emerge ▪ Mob
Slide 9: Creating a Premier Insurgent Fiber Provider
Creating a Premier Insurgent Fiber Provider 9 Market Expansion Opportunity Metro Markets with Uniti Enterprise Service Combined Uniti Network Residential Households ~4.3M Fiber Route Miles (1) ~217K On - Net Locations (2) ~150K % Network Inventory Available ~75% Metro Markets (4) 300+ Near - Net Loc
Slide 10: Unique, diverse footprint with limited overbuilder presence
Unique, diverse footprint with limited overbuilder presence ▪ Rural and geographically diverse footprint: ~75% of footprint in markets with less than 20,000 households ▪ Insurgent fiber provider resulting in 85% of footprint with no overbuilders Additional network investments enhance competitive adv
Slide 11: Kinetic's FTTH Focus Has Significant Upside Potential
Kinetic’s FTTH Focus Has Significant Upside Potential Strong Fiber Expansion Opportunities ~34% 2020 - 2027 CAGR in Fiber Homes Passed (1) ~400K Incremental Fiber Homes Passed by 2027 (1)(2) >40% Long - Term Penetration Rate Target ~1.9M Total Fiber Homes Passed by 2027 (1) 11 Note: All data as of D
Slide 12: Hyperscalers and Gen AI Help Fuel National Growth Opportunity
Hyperscalers and Gen AI Help Fuel National Growth Opportunity 12 $1.9 $2.1 $2.4 $2.7 $2.9 $3.2 $3.5 $3.7 $4.0 2022E 2023E 2024E 2025E 2026E 2027E 2028E 2029E 2030E $1.4 $1.5 $1.6 $1.8 $1.9 $2.1 $2.2 $2.4 $2.6 2022A 2023E 2024E 2025E 2026E 2027E 2028E 2029E 2030E ▪ Recent industry trends have created
Slide 13: Financial Overview
Financial Overview
Slide 14: National Insurgent Fiber Powerhouse with Multiple Levers for Value Creation
National Insurgent Fiber Powerhouse with Multiple Levers for Value Creation 14 ▪ Consumer broadband business with 1.5 million fiber households and ~400,000 current fiber subscribers ▪ Significant growth opportunity – expected to reach ~1.9 million homes by 2027 (1) ▪ Wholesale and commercial fiber i
Slide 15: Strong Financial Profile
Strong Financial Profile 15 2023 Combined 2023 Windstream 2023 Uniti ($ in Billions ) $4.4 $4.0 $1.1 Revenue (1) $1.7 $0.9 $0.9 Adjusted EBITDA (2)(3) $1.2 $1.0 $0.2 Net Capital Expenditures (4) $0.5 ($0.1) $0.8 Free Cash Flow (5) $8.0 $2.4 $5.6 Total Debt (6) $0.8 $0.4 $0.4 Liquidity (6)(7) 4.8x 2.
Slide 16: Meaningful Near-Term Savings & Additional Long-Term Synergies
Meaningful Near - Term Savings & Additional Long - Term Synergies 16 Opex Savings Targeted annual opex savings of up to $100 million ▪ Corporate technology, system and software integration ▪ On - net / off - net savings including backhaul savings ▪ Corporate functions and process efficiencies Capex
Slide 17: Uniti's Path Forward
Uniti’s Path Forward 17 FTTH Upgrade and Expansion Fiber Infrastructure Metro Market & Waves Expansion On - Net Fiber Focus Accretive Financing (i.e. ABS) M&A / SOTP Unlocks Network and Overhead Synergies Powerful Combination Accelerates Trajectory Opportunities for Further Value Creation Strong Und
Slide 18: Creating a Premier Digital Infrastructure Company
Creating a Premier Digital Infrastructure Company 18 Premier Digital Infrastructure Company ▪ Uniti is a premier insurgent fiber provider within the U.S. ▪ Combines Uniti’s hard to replicate national network with scaled FTTH platform ▪ Differentiated position in large and growing Tier II/ III market
Slide 19: Appendix
Appendix
Slide 20: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non - GAAP Financial Measures (1) $ in millions 2023 Windstream Uniti ($210) ($82) Net loss (2) 791 311 Depreciation and amortization 210 512 Interest expense (61) (68) Income tax benefit $730 $673 EBITDA 13 13 Stock - based compensation - 3 Adjustments for unconsolidated entities
Slide 21: Non-GAAP Financial Measures
Non - GAAP Financial Measures We refer to EBITDA and Adjusted EBITDA in our analysis of our results of operations, which are not required by, or presented in accordance with, accounting principles generally accepted in the United States (“GAAP”) . While we believe that net income, as defined by GAAP