National Grid Transco have had their eyes on Crown Castle’s UK broadcasting and mast operation for some time – and they are about to hand over $2.035 billion (€1.67 billion) for it. The deal is still subject to approvals, but is expected to be finalised on or before September 30th.
Crown Castle’s reason for the sale is that the need US$1.3 billion (€1.06 billion) of the money to pay off a credit facility from CC Operating Company.
“The sale of our UK subsidiary is expected to provide us with significant financial and operational flexibility to pursue opportunities in the larger and faster growing US market,” stated John P. Kelly, CEO of Crown Castle. “While our UK operations have been a solid contributor to our business, we believe there is substantially greater growth potential for our US business given the lower penetration of wireless services and the earlier stage of 3G deployments in the US market. This transaction also substantially improves our balance sheet, which we believe will provide flexibility to capitalize on this growth.”
“As a result of this transaction, we will significantly reduce our net debt, exposure to currency fluctuations and floating interest rate exposure,” said W. Benjamin Moreland, the company’s CFO, in a statement.
The other US$740 million (€608 million) will be invested in new business opportunities in the US and to pay off some other debts.