Verizon and Vertical Bridge Agree on $3.3B Tower Deal
Verizon Communications will sell tower company Vertical Bridge “exclusive rights” to lease, operate and manage 6,339 Verizon towers for approximately $3.3 billion, including an upfront payment of $2.8 billion, the companies said Monday. The towers are located in all 50…
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states and Washington, D.C. Verizon agreed to lease back capacity on the towers for 10 years, serving as the anchor tenant, with options for extending the lease term up to 50 years, the companies said: “Verizon will also have access to certain additional space on the towers for its future use, subject to certain restrictions.” Reports that Verizon was seeking to sell towers emerged in July (see 2407160026). In 2015, Verizon sold the rights to lease and operate 11,000 towers to American Tower for an upfront payment of $5 billion (see 1502050059). “This transaction builds on our existing relationship with Vertical Bridge while realizing substantial value for this unique set of assets and allows us to be agile in optimizing the network with one of the best operating partners,” said CEO Hans Vestberg. "We are pleased to have been selected by Verizon as the counterparty in the largest US tower transaction in almost a decade," said Ron Bizick, CEO of Vertical Bridge. In March, Vertical Bridge agreed to pay $310.3 million in cash to buy more than 200 towers from Shentel. Vestberg said during Verizon’s last earnings call in July that while he wouldn’t comment on rumors of a tower sale, the company was seeking additional cash flow. “The focus on cash flow is extremely important because it goes straight into our capital priorities,” he said.