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Crown Castle to buys Quanta Fiber Networks for $1 billion

Staff writer |
Crown Castle International has entered into a definitive agreement to acquire Quanta Fiber Networks for approximately $1 billion in cash, subject to certain limited adjustments.

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Sunesys, a wholly owned subsidiary of Quanta Services, is a fiber services provider that owns or has rights to nearly 10,000 miles of fiber in major metropolitan markets across the United States, including Los Angeles, Philadelphia, Chicago, Atlanta, Silicon Valley, and northern New Jersey.

Approximately 60% of Sunesys' fiber miles are located in the top 10 basic trading areas (BTAs).

The acquisition of Sunesys is expected to further strengthen Crown Castle's leading position in small cell networks by more than doubling Crown Castle's fiber footprint available for small cell deployments and expanding Crown Castle's presence in many of the top U.S. metropolitan markets.

Small cells represent a network of antennas, or nodes, connected by fiber and designed to facilitate wireless communications services for multiple operators that are focused on augmenting their network capacity.

Today, Crown Castle owns or has rights to approximately 7,000 miles of fiber supporting approximately 14,000 nodes, which contribute 7% to each of Crown Castle's site rental revenues and site rental gross margin. Pro forma for the proposed acquisition, Crown Castle will own or have rights to more than 16,000 miles of fiber.

Crown Castle expects the acquisition to close by the end of 2015 and to be immediately accretive to Adjusted Funds from Operations ("AFFO") per share upon closing.

The transaction is expected to contribute approximately $80 to $85 million to gross margin with approximately $20 million of general and administrative expenses in the first year of Crown Castle's ownership.

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