SBA confirms USD1.45bn deal with TowerCo covering US and Puerto Rico

27 Jun 2012

US cell tower operator SBA Communications Corporation has announced that it has entered into a definitive agreement with certain affiliates of TowerCo owning 3,252 tower sites in 47 states across the United States and Puerto Rico. The total cash consideration to be paid by SBA will be USD1.2 billion, as well as 4.6 million shares of SBA Class A common stock, implying a total transaction value of USD1.45 billion. The shares included in the deal will be subject to certain restrictions on transfer, while the cash component will comprise a combination of monies in hand, existing credit facilities and up to USD900 million in financing commitments from JP Morgan. The transaction, subject to customary conditions, is expected to close in the fourth quarter of 2012. Jeffrey A Stoops, SBA’s president and CEO, commented: ‘We believe the TowerCo assets are high quality, well located and have ample capacity for additional tenants. We know the TowerCo management team well, and have the highest regard for them as operators. The towers are in excellent shape from a legal, systems and operational perspective, and will be readily integrated into our existing portfolio. As was the case with our Mobilitie acquisition earlier this year, we expect these towers will be in great demand for the future cell-splitting needs of US wireless carriers, which needs we anticipate will flow from the continued growth in consumer demand for wireless data services’.

As alluded to by Stoops, the TowerCo deal is SBA’s second billion-dollar acquisition this year, after it agreed to buy more than 2,300 towers from Mobilitie for USD1.09 billion in February. He told Reuters: ‘We will not be pursuing any other major US transaction this year’, suggesting that the company is not interested in bidding for the some 37,000 towers that T-Mobile USA is looking to sell.

Puerto Rico, United States