AT&T has announced a transaction deal worth approximately $5 billion has occurred with Crown Castle International Corp.
According to AT&T, the mobile carrier agreed to lease the rights of about 9,100 of its wireless towers to Crown Castle. In addition, Crown Castle will purchase approximately 600 AT&T towers.
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The mobile carrier noted it will receive about $4.85 billion in cash upfront proceeds.
"This deal is good for AT&T and our shareholders," said AT&T Services Inc. Senior Vice President for Network Planning and Engineering Bill Hogg. "This deal will let us monetize our towers while giving us the ability to add capacity as we need it. And we'll get additional financial flexibility to continue to invest in our business, maintain a strong balance sheet and return value to our shareholders."
With the deal, Crown Castle will have exclusive rights to the acquired AT&T towers for the next 28 years. AT&T noted Crown Castle will have a fixed price purchase option of nearly $4.2 billion when the lease expires, based on estimated fair market values.
Despite the Crown Castle acquisition, AT&T may still have a presence as the carrier will sublease a number of the towers for $1,900 per month, per site, for a minimum of 10 years with annual rent increases of two percent. AT&T stated the access to the towers will continue the carrier's mission to meet customer's demand for mobile and Internet services.
How will the deal affect AT&T subscribers?
According to AT&T, the deal will have no impact on consumers. AT&T also stated there will be no impact on their financial results from the transaction.
AT&T expects the deal to be completed by the end of 2013.
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