Crown Castle International Corp.has announced that it acquired Tower Development Corporation (“TDC”) for approximately $461 million in cash. TDC, a portfolio company of Berkshire Partners, owns and operates 336 towers in the U.S. and Puerto Rico with an average tenancy of approximately two tenants per tower.
The deal puts Crown Castle as the largest tower owner in the U.S., although their rival, American Tower Corp., is within 112 towers of reclaiming that title.
Berkshire, along with Denver-based Centennial Funds, were the original investors supporting Crown Castle’s growth.
The transaction is expected to contribute approximately $25 to $27 million to site rental gross margin in the first full year of Crown Castle’s ownership and be immediately accretive to Adjusted Funds from Operations per share. Crown Castle funded the acquisition with available cash, including cash on hand, cash from borrowings under its revolving credit facility and cash from the sale of approximately 3.5 million net shares of common stock at an average price of $85.52 per share year-to-date.
“Our acquisition of TDC is another successful milestone in our long-term relationship with Berkshire Partners,” stated Ben Moreland, Crown Castle’s President and Chief Executive Officer. “The TDC acquisition represents an attractive and accretive investment opportunity that further enhances Crown Castle’s portfolio of wireless infrastructure,” said Moreland in a press statement.
Berkshire’s other portfolio companies include Torres Unidas, a tower development and acquisition company that actively pursues new tower builds and acquisitions in South America; Protelindo, the largest independent owner and operator of wireless towers in Indonesia; and Lightower Fiber Networks, a provider of custom, high-capacity network services that ensure optimal application and business performance in the U.S.