Crown Castle to Sell Australian Business for $1.6 Billion

By Lisa Beilfuss 

Cell-tower owner Crown Castle International Corp. said Thursday that it has reached a deal to sell its Australian subsidiary CCAL for about $1.6 billion in cash to a consortium of private equity investors, as it focuses on expanding its U.S. network.

Crown expects net proceeds of approximately $1.3 billion and said it intends to use the proceeds in part to finance its $1 billion acquisition of Sunesys, a subsidiary of Quanta Services, Inc., which it announced last month. The Sunesys deal is a move to widen Crown's fiber footprint and increase its presence in large U.S. markets.

The CCAL transaction is expected to close during the quarter. The group of buyers is led by Macquarie Infrastructure and Real Assets.

"The sale of CCAL allows us to redeploy capital towards our growing small cell networks, which we expect will be accretive to our long-term AFFO and dividend per share growth rates," said Chief Executive Ben Moreland. AFFO is a closely watched measure of performance for real-estate investment trusts, or REITs, that measures a trust's net income. Crown converted to a REIT last year.

The U.S. market makes up about 96% of the company's total revenue. Crown said the Australian business was expected to contribute about $97 million to $102 million to the overall adjusted Ebitda--or earnings before interest, taxes, depreciation and amortization--of $2.145 billion to $2.16 billion the company expects to report this year.

Companies like Crown Castle, which buy or build portfolios of cell towers that they then rent to carriers, have grown amid a wave of consolidation and investment driven by increased demand for wireless Internet. In late 2013, Crown struck a $4.85 billion deal to lease some towers and buy others from AT&T Inc. Earlier, Crown spent $1 billion to buy NextG Networks Inc.

Access Investor Kit for Macquarie Group Ltd.

Visit http://www.companyspotlight.com/partner?cp_code=P479&isin=AU000000MQG1

Access Investor Kit for AT&T, Inc.

Visit http://www.companyspotlight.com/partner?cp_code=P479&isin=US00206R1023

Access Investor Kit for Macquarie Group Ltd.

Visit http://www.companyspotlight.com/partner?cp_code=P479&isin=US55607P2048

Access Investor Kit for Macquarie Infrastructure Co. LLC

Visit http://www.companyspotlight.com/partner?cp_code=P479&isin=US55608B1052

Access Investor Kit for Quanta Services, Inc.

Visit http://www.companyspotlight.com/partner?cp_code=P479&isin=US74762E1029

Subscribe to WSJ: http://online.wsj.com?mod=djnwires