Telecommunications giant Crown Castle announced it has agreed with an EQT AB fund and Zayo Group Holdings for each to buy separate parts of the fiber business for a combined value of $8.5 billion.
According to separate statements by the companies, the EQT Active Core Infrastructure fund will buy Crown Castle’s small cells business, and Zayo will independently acquire Crown Castle’s fiber solutions business.
This sale enables Crown Castle to focus on its core business, which has around 40,000 towers throughout the US.
The $4.25 billion operation acquired by EQT runs 115,000 small cells on air or under contract across 43 states, providing capacity for high-demand areas lacking macro towers.
Zayo noted that the Crown Castle assets would add around 90,000 route miles of fiber to its network and increase its overall reach to over 70,000 locations. Zayo went private in a 2019 $14.3 billion M&A deal by DigitalBridge and EQT.$14.3 billion.
Crown Castle said the deal is expected to close in the first half of 2026. And Crown Castle is planning about a $3 billion share buyback program.
Morgan Stanley and Bank of America acted as financial advisors to Crown Castle on the deal. And Paul, Weiss, Rifkind, Wharton & Garrison acted as legal advisor to Crown Castle.
KEY QUOTES:
“Together with our Board of Directors, I am excited to announce that we have concluded the strategic review of our Fiber segment with an agreement to sell our small cells and fiber solutions businesses for $8.5 billion. We are also pleased to report that we were able to deliver solid full year 2024 results while conducting the strategic review, highlighted by 4.5% tower organic growth(a) as we remained focused on delivering for our customers. In 2025, we expect a consistent level of activity with organic growth(a) of 4.5% in towers, excluding the impact of Sprint consolidation churn, and anticipate lease and amendment applications to increase year-over-year as our customers continue to add capacity to their 5G networks to meet the persistent growth in mobile data demand in the U.S. We believe a focused, pure-play U.S. tower business will be uniquely well positioned to benefit from the anticipated consistent growth in mobile data demand as we plan to continue to unlock additional value by pursuing initiatives that enhance customer service, revenue growth, capital discipline, and operational excellence. To increase free cash flow generation and financial flexibility, we are updating our capital allocation framework, which is anticipated to result in a reduction to our annualized dividend to approximately $4.25 per share in the second quarter of 2025, and the expected implementation of an approximately $3.0 billion share repurchase program following the closing of the transaction(b). We believe this capital allocation framework can provide an attractive combination of near-term capital return, flexible share repurchases, and long-term financial flexibility to pursue growth opportunities in the future.”
“Selling our Fiber segment represents a significant step on Crown Castle’s path towards a refined focus as a pure-play provider of multi-tenant tower assets. As we look ahead, with our expansive and capital efficient portfolio of approximately 40,000 towers across key locations in the U.S., which we believe is the best wireless market in the world, and greater focus on customer service and operational initiatives, we anticipate that we can generate durable and growing cash flows that will provide attractive returns to our shareholders.”
- Steven Moskowitz, Chief Executive Officer of Crown Castle
