August 2, 2012
T-Mobile In Talks To Sell Off Cell Towers
Lee Rannals for redOrbit.com - Your Universe Online
So far, tower operator Crown Castle International is the lead bidder for the T-Mobile towers, according to the report.
T-Mobile is currently the smallest of the large carriers in the U.S., and the only major provider that doesn't sell Apple's iPhone.
The report said that it is still unclear exactly how the deal would be structured, because tower deals tend to be very complicated.
Tower companies typically trade at a multiple cash flow, the Journal said, and Evercore Partners analyst Jonathan Schildraut said the company's towers could generate around $110 million to $120 million a year.
T-Mobile said back in February that it would be upgrading its network to the high-speed technology LTE over the next several years. Other companies have already begun implanting this new technology, and devices like Apple's iPad already use these services.
T-Mobile tried merging with AT&T late last year, but that deal collapsed due to critics worrying about what implications such a large merger could have on the rest of the mobile industry. The company was given $1 billion worth of spectrum from AT&T as part of its breakup fee, but analysts say that it isn't enough to meet T-Mobile's needs, according to the report.
The original deal for AT&T to buy out T-Mobile was a $39 billion bid, but regulatory opposition squashed the proposal.
The Journal said it could take months before a deal is reached for T-Mobile's towers, but the sale is expected to happen regardless of whether any of those talks pan out.
The money T-Mobile would receive through selling its towers could help it buy spectrum it has agreed to take from Verizon Wireless, in exchange for T-Mobile's support of Verizon's proposed purchase of spectrum from Spectrum Co.