American Tower Corp., a communications tower owner, has announced an agreement to acquire the outstanding common membership interests of MIP Tower Holdings LLC, which is the parent company of Global Tower Partners, and related companies, for a purchase price of approximately $4.8 billion.
GTP is majority owned by Macquarie Infrastructure Partners together with minority partners, including PGGM, a Dutch pension fund manager, and GTP management. GTP owns and operates approximately 5,400 domestic towers, 800 domestic property interests under third-party communications sites, and has management rights to over 9,000 domestic sites, which are primarily rooftop assets, according to a release. GTP also owns 500 communications sites in Costa Rica, it added.
According to the announcement, the purchase price is expected to be paid with approximately $3.3 billion in cash and the assumption of approximately $1.5 billion of existing indebtedness. American Tower expects to use cash on hand and borrowing capacity under its existing revolving credit facilities, as supplemented by additional anticipated sources of financing.
American Tower says it expects that the portfolio will generate approximately $345 million in revenues and approximately $270 million of gross margin in 2014.
“GTP’s towers boast a high-quality customer base, a strong position with respect to ground ownership and lease terms, and additional structural capacity available to facilitate future leasing activity,” said American Tower Chairman, President and CEO Jim Taiclet. “With all four major domestic wireless carriers engaged in aggressive multiyear 4G LTE deployments, we believe our acquisition of GTP solidifies our path to achieving our strategic goals related to growing our AFFO over the next five years.”
The transaction is subject to customary closing conditions and is expected to be completed in the fourth quarter of this year.