NEW YORK-Boston-based American Tower Systems Corp. sold a secondary offering of 29.37 million shares of Class A common stock July 2 at a price of $23.50 each in connection with its spinoff from American Radio Systems Corp., which CBS Corp. purchased.
In response to investor demand, the company increased significantly the number of Class A shares sold. It had registered with the Securities and Exchange Commission for an offering of 23.62 million common shares of stock.
“We appreciate the broad and deep support that we received in this offering, and we are now well positioned to build a substantial company,” Steven B. Dodge, chairman and chief executive officer, said.
American Tower owns and/or operates more than 1,800 wireless communications towers in 44 states and the District of Columbia.
For each American Radio share they own, stockholders are to receive a cash payment of $44 plus one share of the American Tower common stock from American Tower’s add-on equity sale. Credit Suisse First Boston, New York, was lead underwriter for the offering.
As a consequence of its parent’s merger, American Tower estimated in early June it would be obligated to pay CBS between $305 million and $330 million for taxes. The tax reimbursement obligation is the result of the rise in American Radio’s share price due to investor anticipation of its purchase by CBS.
American Tower said last month it would issue enough preferred stock to fund the tax reimbursement obligation, which relates to the distribution of American Tower common stock to American Radio shareholders.
In announcing completion of the common stock sale, American Tower said it will use net proceeds “to redeem all of the outstanding shares of its Pay-In-Kind Preferred Stock at a price of 101 percent of the liquidation preference … to reduce bank borrowings and to fund future acquisitions and construction activities.”
American Tower’s stock, which traded over the counter until its latest equity sale, now are listed on the New York Stock Exchange.
