Verizon (NYSE: VZ) is testing the waters on selling thousands of towers that are part of its nationwide wireless network, Bloomberg reported. Verizon is the largest mobile network operator in the U.S. by subscriber count, and operates close to 80,000 macrocells and nearly 50,000 small cells that support its 4G and 5G services, according to Inside Towers Intelligence.
New York-based Verizon has hired advisers to gauge interest from potential buyers for a block of roughly 5,000 to 6,000 towers that could sell for an estimated $3 billion, according to Bloomberg sources. A search of the Inside Towers Database shows a tally of 5,622 towers registered under the Verizon Wireless name. JP Morgan is running the deal, an Inside Towers source suggested.
Discussions of any tower sale are still in the early stage and any deal is not assured, Bloomberg reported. Verizon has not commented.
Nonetheless, the towers for sale this time around are expected to attract interest from established larger tower companies and digital infrastructure investment firms, Bloomberg sources suggested.
Historically, MNOs established their wireless networks by building and operating their own towers. Over time, however, the MNOs realized that those towers, while they support active, revenue-generating cell sites, are passive infrastructure assets that generate operating expenses but carry substantial value. MNOs gradually sold off the bulk of their towers to independent tower companies as a way to raise cash to pay down debt and to fund network expansion.
To wit, Verizon in 2015 entered into a sale and lease back arrangement with American Tower (NYSE: AMT) on roughly 11,000 towers for an upfront payment of about $5 billion. The funds helped Verizon acquire more spectrum and to pay down debt.
AT&T (NYSE: T) agreed in 2013 to sell 9,700 towers to Crown Castle (NYSE: CCI) in a $4.8 billion transaction. In that case, AT&T used the funding to begin an upgrade of its network.
By John Celentano, Inside Towers Business Editor
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