Another one for Alex

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Screen Shot 2015-03-24 at 10.25.47 AMCiG Wireless announced the signing of a definitive agreement to be acquired by an affiliate of Vertical Bridge Holdings. Vertical Bridge will acquire CiG Wireless’ tower assets, including 200 tower sites. The all cash deal is valued at approximately $143 million. This deal comes after CiG Wireless reported an operating loss of $2.1 million during its fiscal third quarter of 2014. The company’s revenue was up due to acquisitions completed in 2013 and 2014. In May 2013, CiG Wireless acquired thirty communications towers from Southern Tower Antenna Rental. For the year, CiG announced two other acquisition deals, bringing their total number of acquired sites for 2013 to 74, with 252 in-progress sites, spending nearly $50 million.

“This transaction brings together two complementary cellular tower operators, and the combined business will have a broad geographic presence across the United States,” said Paul McGinn, Chief Executive Officer of the Company. The deal, which is expected to close during the second quarter of 2015, has received the support of the Company’s largest shareholder, Fir Tree Partners, a New York based private investment firm, who has voted its shares in favor of the transaction. “We have known Paul and the rest of the CiG Wireless team as competitors and partners over the course of many years, and we look forward to them joining our team,” said Alexander L. Gellman, CEO and Co-Founder of Vertical Bridge. This is another acquisition in a long line of deals made by Vertical Bridge. In December 2014, the company acquired a select portfolio of iHeartMedia’s tower assets for up to $400 million; in addition to that purchase, Vertical Bridge acquired 595 of U.S. Cellular’s towers for $159 million.

Spencer Kurn at New Street Research commented, “This transaction looks expensive at ~$640k per completed site; however, with another 121 sites under construction, we estimate Vertical Bridge is only paying ~$415 per site, in-line with recent US comps.  We expect Vertical Bridge to continue to acquire smaller US tower portfolios over the next several years.”

March 24, 2015 |
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