Crown Castle, a major wireless tower operator, has agreed to pay T-Mobile $2.4 billion in cash for rights to 7,200 cell phone towers.
Under the transaction, Crown Castle will lease the towers for 28 years, after which time it will have the option to purchase the assets from T-Mobile.
The deal comes as T-Mobile, a unit of Deutsche Telekom, tries to find its way, in the aftermath of AT&T‘s failed $39 billion bid for the American subsidiary, which crumbled last year amid regulatory opposition. Since the deal collapsed, Deutsche Telekom's management team has reiterated the need for new investment and increased network capacity. On Friday, the company said it would use the proceeds to pay down debt and improve its network service.
“We are pleased to reach this mutually beneficial agreement with Crown Castle,†John Legere, the head of T-Mobile USA, said in a statement on Friday. “T-Mobile USA is working aggressively to make our 4G network stronger, fast er and more dependable for consumers, and this transaction will support our ongoing $4 billion network modernization initiative that is the cornerstone of this effort.â€The deal is expected to close in the fourth quarter of this year.
For Crown Castle, the deal will allow the company to significantly expand its network of towers in the top markets of United States and improve service in densely populated cities. The transaction, which will increase its tower count by a third, will be funded by a mix of cash and debt. It is expected to close in the fourth quarter of this year.
