US incumbent AT&T has confirmed it is looking to sell wireless infrastructure following a report last week regarding a potential US$5bn disposal of its towers.
In a statement AT&T said it “is exploring opportunities to monetise some or all of its…
US incumbent AT&T has confirmed it is looking to sell wireless infrastructure following a report last week regarding a potential US$5bn disposal of its towers.
In a statement AT&T said it “is exploring opportunities to monetise some or all of its remaining wireless tower assets”.
The Texan telco added that any sale would be contingent on securing a suitable long-term leaseback agreement.
AT&T said it could sell either some or all of its towers that it still holds, estimated at 10,000. It has mandated JP Morgan and TAP Advisors to offload the assets, according to a report last week.
American Tower, Crown Castle and SBA Communications have been touted as possible buyers for the portfolio.
AT&T may use the proceeds of a disposal for its planned US$14bn network upgrade and up to US$11bn stock repurchase. It also said it is examining potential acquisitions in Europe.
However it has been busy in its domestic market this year, buying spectrum from Verizon Wireless for US$1.9bn and Nextwave for US$600m, and agreeing to acquire Leap Wireless for US$1.2bn and Alltel for US$780m.
Nomura analyst Adam Ilkowitz said a tower sale could be useful in relation to these transactions: “A potential tower sale could be seen as funding the $4bn in M&A completed year to date as well as the $1.2bn in cash required for Leap in 2014.”
Completes US$780m Alltel deal
In the same statement, AT&T announced the completion of the Alltel deal. The US$780m acquisition of Atlantic Tele-Network’s wireless operations, which operate under the Alltel brand, sees AT&T obtain wireless assets across six states – including spectrum in the 700 MHz, 850 MHz and 1900 MHz bands – and approximately 590,000 subscribers.
First agreed in January, the Federal Communications Commission’s (FCC) decided to stop the clock on its review into the transaction in August.
The regulator’s worries centred on how the operator planned to transition Alltel’s customers onto its network.
AT&T subsequently agreed to a number of remedies which focus on coverage commitments, keeping networks open for a certain period of time, and providing Alltel customers with free replacement handsets compatible with its HSPA+ network, as opposed to Alltel’s CDMA system.
Alltel operates a CDMA network that covers Georgia, Idaho, Illinois, North Carolina, Ohio and South Carolina.
Stephens Inc served as financial adviser to Atlantic Tele-Network and provided a fairness opinion for the transaction, while Cleary Gottlieb Steen & Hamilton and Jenner & Block provided legal counsel.
