ATLANTA, April 15 /PRNewswire/ -- Preferred Networks, Inc. (Nasdaq: PFNT)
(PNI), an outsourcing services provider to the wireless industry, today
announced that it has entered into an agreement to obtain $15 million through
the sale of redeemable preferred stock and warrants in a private placement
with five institutional investors that are currently shareholders of PNI.  The
amount may increase to $20 million at the option of the investors.  The
proceeds of the transaction should enable the company to fund the completion
of its build-out of wireless messaging networks in the 50 largest U.S.
metropolitan markets and adjacent areas.  The sale of the preferred stock and
warrants is subject to shareholder approval and the execution of definitive
documents and is expected to close in June 1997.
    PNI's Chairman and CEO Mark Dunaway said, "We are pleased with the strong
support we are receiving from our original institutional investors and their
endorsement of our outsourcing services platform.  Companies operating in the
wireless sector, and paging in particular, are today finding it very difficult
to raise necessary capital in the public market.  This funding is particularly
meaningful to PNI because it should provide sufficient capital to complete our
build-out and fund our operations during this period."
    Since its IPO in March 1996, PNI has expanded its networks from the Mid-
Atlantic and Southeast to include the Northeast, Midwest, North Central and
Northwest regions.  PNI has also increased its customer base and has expanded
its services through two strategic acquisitions, allowing it to offer
engineering/technical services for wireless carriers and manufacturers, and
sales, repair and fulfillment of pager and cellular equipment for wireless
carriers, manufacturers and resellers.
    Mr. Dunaway said, "0ur expanded services platform positions us to provide
multiple outsourcing solutions to larger companies.  As capital has become
increasingly difficult for many wireless companies to obtain, we believe many
of these companies will seek to shed expenses through outsourcing and focus
their internal resources on increasing subscriber cash flow.  Because we do
not compete with our customers for subscribers, we believe PNI will be an
attractive partner for a number of these companies."  PNI currently provides
outsourcing services to more than 1,400 companies, including nine of the top
ten paging companies, the two largest manufacturers of wireless network
infrastructure, the second largest cellular product manufacturer and two
regional Bell operating companies.
    In connection with this funding, PNI is implementing certain initiatives
aimed at serving larger customers, reducing operating expenses and conserving
capital resources:

    Focus on "Co-location/Interconnection" Network Customers:  PNI intends to
    direct its primary network services focus toward "co-location/
    interconnection" customers, who own paging terminals that they co-locate
    in a PNI facility or, alternatively, interconnect to PNI via telephone
    circuits.  These companies are primarily larger, with a greater number of
    units in service per customer on PNI's networks, than traditional
    resellers.  Although PNI will continue to serve its reseller customers, it
    will encourage them, where feasible, to move to co-location/
    interconnection services.  Generally, co-location/interconnection accounts
    produce lower revenues per unit in service, but the capital investment and
    operating expenses associated with them are also lower.

    Complete Nationwide Build-out of Networks with less Capital Investment:
    The company has reduced the amount of planned capital investment required
    for completion of its nationwide build-out of networks by further
    utilizing its existing centralized switching centers (Technical Control
    Centers or TCCs) to provide network services to additional markets.  PNI
    currently operates six TCCs.  While the company had originally planned for
    an additional four TCCs, PNI now plans to construct only one additional
    TCC and several additional Remote Points of Presence (R-POPs), which
    require less capital investment than TCCs, while still providing high
    quality network services.  The company currently operates networks in
    21 markets and has 28 additional markets under construction.

    Reduce Product Costs:  Like many wireless carriers, PNI has historically
    offered pager equipment to its customers as part of its efforts to add
    service units through these customers.  The company is presently
    integrating all of its product sales and inventory into its product
    services subsidiary, EPS Wireless, Inc. (EPS).  EPS will continue to offer
    pager equipment to the company's network customers and intends to develop
    an expanded supply of refurbished product for them.  EPS typically is able
    to achieve a lower cost by refurbishing product, compared to the cost PNI
    incurs when it purchases new product directly from the manufacturers.

    Preferred Networks, Inc., headquartered in metropolitan Atlanta, provides
outsourcing solutions to the wireless industry, enabling its customers to
offer branded wireless services directly to subscribers, while relying on the
company to provide high-quality network, technical, and product services at
competitive prices.  PNI offers its services through its wholesale paging
networks as one of the largest carrier's carriers and through its wholly owned
subsidiaries:  Preferred Technical Services, which provides wireless network
equipment installation, maintenance and engineering services, and EPS, which
is one of the five largest repair facilities providing paging and cellular
product repair, sales, and fulfillment services.  PNI's address on the World
Wide Web is: http://www.pni.net.
    The Private Securities Litigation Reform Act of 1995 provides a "safe
harbor" for forward-looking statements.  Certain information included in this
press release contains statements that are forward-looking, such as statements
relating to construction and other business development activities, future
capital expenditures, operating revenues and expenses, and financing sources
and availability.  Such forward-looking information involves important risks
and uncertainties that could significantly affect anticipated results in the
future and, accordingly, such results may differ from those expressed in any
forward-looking statements made by or on behalf of the company.  These risks
and uncertainties include, but are not limited to, uncertainties affecting the
paging and wireless industries generally, risks relating to the company's
acquisition, construction and other business development activities, risks
relating to technological change in the paging and wireless industries, risks
relating to the ability of the company to obtain additional funds in the form
of debt or equity, risks relating to the availability of transmitters,
terminals, network project management services and network engineering
support, fluctuations in interest rates, and the existence of and changes to
federal and state laws and regulations.

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