American Tower to buy MIP Tower in $4.8-bn deal

American Tower Corp (ATC), the owner of the biggest mobile tower network in the US, yesterday said that it would buy privately held MIP Tower Holdings, in a $4.8 billion deal, in order to expand its wireless sites in the country.

The $4.8 billion transaction, which includes debt of $1.5 billion, is expected to close in the fourth quarter.

ATC expects to fund the transaction through cash at hand and borrowing under its existing revolving credit facilities.

The deal comes a month after ATC agreed to buy about 4,500 telecom towers in Brazil and Mexico from Latin American telecom service provider NII Holdings Inc, for $811 million.

MIP Tower is a private real estate investment trust, which is the parent company of Global Tower Partners (GTP), and in turn is majority owned by Macquarie Infrastructure Partners, along with minority partners that include Dutch pension fund manager PGGM and management.

GTP owns and operates around 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. In addition, GTP owns 500 communications sites in Costa Rica.

The acquisition will add about 15,700 communication towers in the US and Costa Rica to American Tower's existing portfolio of 56,000 towers globally.

ATC expects that in 2014, the acquisition will generate approximately $345 million in revenues and approximately $270 million of gross margin, and is anticipated to be immediately accretive to its 'adjusted funds from operations' upon closing.

''GTP has constructed and acquired an outstanding US portfolio of tower, rooftop and land assets, which is highly complementary to that of American Tower. 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, Jim Taiclet, chairman, president and CEO of ATC.

He adde, "With all four major domestic wireless carriers engaged in aggressive multi-year 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.''

Founded in 1995, Boston, Massachusetts-based ATC is the largest independent owner, operator and developer of wireless and broadcast communications real estate, with a portfolio of approximately 56,000 properties, including wireless towers, broadcast towers and Distributed Antenna System (DAS) networks.

Its tower portfolio consists of nearly 23,000 towers in the US and over 33,000 towers internationally in Brazil, Chile, Colombia, Germany, Ghana, India, Mexico, Peru, South Africa and Uganda.

It also has 300 DAS networks that it operates in malls, casinos, other in-building applications, and select outdoor environments.

In 2010, ATC acquired Essar Telecom Infrastructure, one of India's largest independent mobile mast companies with 4,500 towers, in a $430 million deal.