After three months of rumors that some sort of a tower deal was looming, Sprint (NYSE: S) has entered into a sale and leaseback deal “of certain existing network assets” with “Network LeaseCo”) that will provide it $2.2 billion. Sprint said the network assets involved in the transaction, which have a net book value of approximately $3 billion and consist primarily of equipment located at cell towers, will remain on Sprint’s consolidated financial statements and will continue to be depreciated.
“Network LeaseCo will acquire certain existing network assets and then lease them back to Sprint. The assets acquired by Network LeaseCo will be used as collateral to raise approximately $2.2 billion in borrowings from external investors, including SoftBank,” Sprint said. “The $2.2 billion of cash proceeds Sprint expects to receive from the transaction is scheduled to be repaid in staggered, unequal payments through January 2018.”
News of the deal was met on Wall Street with a tepid reception. At 2 pm, Sprint shares were off by 12 cents at $3.46 per share.
