SBA Communications to merge with TowerCo in $1.45 billion deal

Telecom Lead America: SBA Communications has entered into
a merger agreement with certain affiliates of TowerCo that own 3,252 tower
sites in 47 states across the U.S. and Puerto Rico.

The consideration to be paid by SBA will be $1.2 billion
in cash and 4.6 million shares of SBA Class A common stock, implying a total
transaction value of $1.45 billion based on SBA’s average three-day closing
price of $54.48 as of June 22, 2012.

The cash consideration will be paid from a combination of
cash on hand, existing credit facilities and up to $900 million in financing
commitments from J.P. Morgan.

SBA expects that its net debt to annualized adjusted
EBITDA ratio will be approximately 7.8x to 8.0x. SBA estimates the TowerCo
assets will produce approximately $93 to $95 million in tower cash flow for the
full calendar year 2013.

“We believe the TowerCo assets are high quality,
well located and have ample capacity for additional tenants. We know the
TowerCo management team well, and have the highest regard for them as
operators. The towers are in excellent shape from a legal, systems and
operational perspective, and will be readily integrated into our existing
portfolio,” said Jeffrey A. Stoops, SBA’s President and Chief Executive

As was the case with our Mobilitie acquisition earlier
this year, we expect these towers will be in great demand for the future
cell-splitting needs of US wireless carriers, which needs we anticipate will
flow from the continued growth in consumer demand for wireless data services.
We expect this transaction will be immediately accretive to AFFO per
share,” Stoops added.

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