SpectraSite tunes in SBC towers
By CBS.MarketWatch.com
Last Update: 7:44 AM ET Aug 28, 2000 NewsWatch
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CARY, N.C. (CBS.MW) - In a deal to give it the largest tower portfolio in the top 50 U.S. markets, SpectraSite Holdings struck a deal with SBC Communications to lease 4,700 communications towers for about $1.3 billion.
SpectraSite (SITE: news, msgs) will lease 3,900 communications towers for wireless phones and other uses, plus it's getting a five-year exclusive built-to-suit agreement for about 800 towers more.
Shares of SBC (SBC: news, msgs) ended up 5/16, or 0.77 percent, at 40 13/16 on Friday, while those of SpectraSite were unchanged at 21.
The deal includes $983 million in cash and $325 million SpectraSite common stock to be paid to SBC. SpectraSite also has the option to purchase the 3,900 towers at a present value of $251 million.
SpectraSite Chief Executive Officer Stephen H. Clark said the deal "will create significant shareholder return" and that the SBC towers represent "the potential for extremely attractive recurring revenue on a per tower basis."
SBC Wireless has agreed to sublease space from SpectraSite for about $65.5 million per year.
The companies expect the deal to close in increments starting in the fourth quarter.
The SBC towers are located in "significant" concentrations in Los Angeles, San Diego, San Francisco, Boston, Washington, Baltimore, Philadelphia, Dallas, St. Louis, Las Vegas, Chicago and Cleveland.
With the addition of the SBC towers, SpectraSite will control more than 9,000 towers in the U.S.
The deal "cements SpectraSite's position as the leading tower provider in the top 50 markets," the company said.
SBC gets a seat on SpectraSite's board of directors
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