Crown Castle International announced on Monday that it has signed an agreement to sell its UK subsidiary to National Grid Transco for £1.1bn. The transaction should be completed by the end of September.
NGT will merge Crown Castle UK with Gridcom, its wholly owned subsidiary, to create a combined business that will be an independent provider of infrastructure to the UK mobile telecommunications operators, with a portfolio of some 5,000 sites. Crown Castle UK is also one of two providers of infrastructure for transmission of UK terrestrial analogue and digital television and has a good position for the expansion in digital viewing.
The CEO of Crown castle, John Kelly, said: “The sale of our UK subsidiary is expected to provide us with significant financial and operational flexibility to pursue opportunities in the larger and faster growing US market.
“While our UK operations have been a solid contributor to our business, we believe there is substantially greater growth potential for our US business given the lower penetration of wireless services and the earlier stage of 3G deployments in the US market. This transaction also substantially improves our balance sheet, which we believe will provide flexibility to capitalise on this growth.”
The sale will allow Crown Castle to reduce net debt, exposure to currency fluctuations and floating interest rate exposure, according to the firm’s CFO, W. Benjamin Moreland.
