American Tower To Buy Global Tower Partners For About $4.8 Bln

(RTTNews) - Communication tower sites operator American Tower Corp. (AMT) said Friday that it has agreed to buy MIP Tower Holdings LLC, a private real estate investment trust that is the parent company of rival Global Tower Partners, for about $4.8 billion. The deal enables American Tower to add a portfolio of tower, rooftop and land assets that are highly complementary to its own.

American Tower expects to pay about $3.3 billion in cash and assume about $1.5 billion of existing debt in the deal. The transaction is expected to close in the fourth quarter of 2013.

Global Tower Partners or GTP is majority-owned by Macquarie Infrastructure Partners together with minority partners, including Dutch pension fund manager PGGM and management. GTP is the largest privately-owned cell tower operator in the U.S. and the fourth-largest independent operator in the U.S.

GTP owns and operates about 5,400 domestic towers, 800 domestic property interests under third-party communications sites, and has management rights to over 9,000 domestic sites that are primarily rooftop assets. GTP also owns 500 communications sites in Costa Rica.

Jim Taiclet, chairman, president and chief executive officer of American Tower, said, "GTP has constructed and acquired an outstanding U.S. portfolio of tower, rooftop and land assets, which is highly complementary to that of American Tower. Moreover, GTP's management of these assets has been excellent, as confirmed through our rigorous due diligence process."

Taiclet added that with all four major domestic wireless carriers engaged in aggressive multi-year 4G LTE deployments, American Tower's acquisition of GTP will strengthen its path to achieving strategic goals related to growing its adjusted funds from operations or AFFO over the next five years.

American Tower expects to use cash on hand as well as borrowing capacity under its existing revolving credit facilities that can be supplemented by additional anticipated sources of debt financing to satisfy the cash consideration for this acquisition as well as other previously announced acquisitions.

American Tower plans to maintain its financial and capital structure policies, consistent with investment grade credit metrics. The company also expects to use the cash flow and margin characteristics of the GTP portfolio to de-lever over time back to its stated target leverage range.

American Tower expects the GTP portfolio to generate revenues of about $345 million and gross margin of about $270 million in 2014. The company anticipates the transaction to be immediately accretive to its AFFO upon closing.

In August, American Tower said it reached a deal with NII Holdings, Inc. (NIHD) to buy up to 2,790 towers in Brazil and 1,666 towers in Mexico, in two separate transactions for a total of about $811 million.

In July, American Tower reported a profit for the second quarter that more than doubled from the prior-year period on a 16 percent growth in revenues. Net income attributable to the company surged to $99.82 million or $0.25 per share from $48.21 million or $0.12 per share in the previous year. Total operating revenues for the quarter climbed to $808.83 million from $697.73 million last year.

In Friday's regular trading session, AMT is trading at $72.01, up $3.26 or 4.74 percent on a volume of 232,675 shares.