American Tower Corporation (NYSE: AMT) today announced that it has
reached an agreement with NII Holdings, Inc. (NASDAQ: NIHD) to acquire
up to 2,790 towers in Brazil and 1,666 towers in Mexico in two separate
transactions, for approximately $413 million and $398 million,
respectively, based on current foreign currency exchange rates. The
transaction agreements provide that all payments, including the tower
rent, will be made in local currency. American Tower expects to use cash
on hand and borrowings under its existing revolving credit facilities to
fund the acquisition.
American Tower expects the towers will collectively generate
approximately $149 million in annual run rate revenues and approximately
$55 million in annual Gross Margin and anticipates that the acquisition
will be immediately accretive to Adjusted Funds from Operations upon
closing. Both Nextel Brazil and Nextel Mexico have agreed to leaseback
the towers from American Tower for a minimum 12-year initial lease term
with additional renewal options thereafter. NII International Telecom
S.C.A, a subsidiary of NII based in Luxembourg, has agreed to provide
certain credit support with respect to the obligations of Nextel Brazil.
The majority of the portfolio consists of towers located in and around
major population areas and along major highways. On average, the towers
have a tenancy ratio of just over one tenant per tower, with Nextel
Brazil or Nextel Mexico as the primary tenant, providing significant
opportunities for future site leasing growth. American Tower expects to
invest approximately $50 million in start-up capital expenditures
associated with the two portfolios.
Jim Taiclet, Chairman, President and Chief Executive Officer of American
Tower, said: "Through this acquisition, American Tower will gain
significant incremental scale in our Mexican and Brazilian operations,
and we anticipate leveraging the strong demand backdrop in both markets
to drive meaningful revenue and cash flow growth for many years to come."
The transactions are subject to regulatory approvals and the initial
closing under each transaction is expected to be completed in the fourth
quarter of 2013. These initial closings are expected to be followed by
subsequent closings of additional tranches of towers as certain closing
requirements relating to the remaining tranches are satisfied.
American Tower was advised by Evercore as financial advisor and
Kilpatrick Townsend & Stockton as legal advisor.
About American Tower
American Tower is a leading independent owner, operator and developer of
wireless and broadcast communications real estate. American Tower
currently owns and operates over 56,000 communications sites in the
United States, Brazil, Chile, Colombia, Germany, Ghana, India, Mexico,
Peru, South Africa and Uganda. For more information about American
Tower, please visit www.americantower.com.
Cautionary Language Regarding Forward-Looking Statements
This press release contains statements about future events and
expectations, or “forward-looking statements,” all of which are
inherently uncertain. We have based those forward looking statements on
management’s current expectations and assumptions and not on historical
facts. Examples of these statements include, but are not limited
to, statements regarding our expectations of the acquisition of certain
towers, expected financial projections for the acquired towers,
anticipated closing dates, and the expected cash consideration. These
forward-looking statements involve a number of risks and uncertainties.
Among the important factors that could cause actual results to differ
materially from those indicated in such forward-looking statements
include market conditions for corporate debt generally, for the
securities of telecommunications companies and for our indebtedness in
particular. For other important factors that may cause actual results to
differ materially from those indicated in our forward-looking
statements, we refer you to the information contained in Item 1A of our
Form 10-Q for the quarter ended June 30, 2013 under the caption “Risk
Factors” and in other filings we make with the Securities and Exchange
Commission. We undertake no obligation to update the information
contained in this press release to reflect subsequently occurring events
or circumstances.
Copyright Business Wire 2013