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Cell Tower News: Sprint, American Tower make $2 billion moves

American Tower investing $2B more in India

American Tower continues its investment in Indian telecom infrastructure, committing to invest an additional $2 billion. This news came from a meeting this week between American Tower CEO James Taiclet Jr. and India’s minister Ravi Shankar Prasad. It was not disclosed yet what the $2 billion would be spent on.

This new amount is in addition to $1.21 billion American Tower spent this past November acquiring a controlling stake in Indian telecom infrastructure company Viom Networks, which has since been approved by India regulators. Previous to this deal, American Tower owned 14,000 towers in India, with the Viom deal bringing the total up to 56,200 towers.

“It attains our goal to be the No. 1 independent tower company in the country,” Taiclet said. “The integration will take a year or two. India becomes incredibly important for us. This transaction will make it a billion-dollar business for us for the calendar year 2016. From an asset perspective, this is the largest number of towers we have anywhere in the world.”

We’ll have more on American Tower’s $2 billion Indian investment as it divulges plans for the money.

Sprint spins off new tower-related company

Sprint and its parent company SoftBank created a separate business entity for the sole purpose of owning and managing its network assets. This new entity, christened Network LeaseCo, purchased $2.2 billion in assets, which were primarily cell tower network equipment. The money will be collected from SoftBank and other external investors and paid to Sprint “in staggered, unequal payments through January 2018.”

To get to the heart of what this move is really about, Sprint CFO Tarek Robbiati said: “This transaction is an important first step in addressing upcoming debt maturities and allows us to stay focused on our corporate transformation, which involves growing top line revenues and aggressively taking costs out of the business to improve operating cash flows.” That means this was more than anything a move to make the company look more attractive on paper and in financial results for its investors.

The financial world is less than impressed with this move however, as Sprint stock dropped a little more than 3% in light of this development.

Tower news quickies

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Jarad Matula
Jarad Matula
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