Crown Castle Had A Very Busy Weekend

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Not only did Crown Castle announce their acquisition of a portion of AT&T’s towers, they also announced their Proposed Public Offerings of Common Stock and Mandatory Convertible Preferred Stock as well as their Third Quarter results. Crown Castle announced today that it is commencing concurrent offerings of 36,000,000 shares of its common stock and 7,500,000 shares of its Mandatory Convertible Preferred Stock, Series A, each in a separate registered public offering, subject to market and other conditions. These offerings are separate public offerings made by means of separate prospectus supplements and are not contingent on each other or upon the consummation of the AT&T Transaction.

The reason behind this announcement is that Crown Castle expects to use the proceeds from these offerings, along with cash on hand and additional debt financing to finance the acquisition of A&T’s towers.

“ If for any reason the AT&T Transaction does not close or closes with respect to a reduced number of sites or for reduced consideration, then Crown Castle expects to use any remaining net proceeds from these offerings for general corporate purposes, which may include the repurchase or repayment of indebtedness. Crown Castle intends to grant the underwriters in each respective offering the option to purchase up to an additional 5,400,000 shares of its common stock and up to an additional 1,125,000 shares of its Mandatory Convertible Preferred Stock,” Crown Castle explained in a press release.

Crown Castle also reported their third-quarter results, which ended September 30, 2013. Total revenue for the third quarter of 2013 increased 21% to $749 million from $621 million for the same period in 2012. Site rental revenue for the third quarter of 2013 increased $82 million, or 15%, to $621 million from $539 million for the same period in the prior year. Site rental gross margin, defined as site rental revenue less site rental cost of operations, increased $35 million, or 9%, to $439 million in the third quarter of 2013 from $403 million in the same period in 2012. Adjusted EBITDA for the third quarter of 2013 increased $40 millionor 10%, to $441 million from $400 million in the same period in 2012.

“We are thrilled with the announcement of the AT&T tower transaction and the continued performance of our core business, which delivered 38% growth in AFFO per share in the third quarter 2013 compared to the same quarter last year,” stated Ben Moreland, Crown Castle’s President and Chief Executive Officer. “During the third quarter, we saw a significant increase in new leasing activity as the carriers focused on improving network quality. Based on this activity and our expectations for next year, our 2014 Outlook assumes 25% to 30% more revenue from new leases in 2014 compared to 2013, before additional leasing activity we expect on the AT&T towers.”

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