Cequel III LLC, the St. Louis-based investment firm headed by cable veteran Jerry Kent, said Friday that it has agreed to sell its communications-tower business, AAT Communications Inc., to SBA Communications Corp. for $1 billion in cash and stock.
The deal is expected to close in the second quarter.
Cequel III began investing in communications towers in 2002, and AAT is currently the largest privately held owner of wireless towers in the country and the fifth-largest independent owner of such sites in the United States. Since investing in AAT in 2002, Cequel has expanded its portfolio from 300 towers to nearly 2,000.
In a statement, Cequel said it decided to sell the tower business for a number of reasons -- it became increasingly difficult to acquire and build new towers and the company, through its Cebridge Connections cable subsidiary, felt that it needed to focus more on its expanding cable operations.
Cequel has done two large deals for cable systems in the past few months, agreeing in November to buy 940,000 subscribers from Cox Communications Inc. for an estimated $2.3 billion and agreeing last month to buy another 240,000 customers from Charter Communications Inc. for $770 million in cash.
The Cox deal is expected to close in April. The Charter deal should close by the third quarter of this year.
“We love the tower business, but we also know that the operating scale SBA brings to the table is critically important to the future of AAT,” Kent said in a prepared statement. “It was increasingly difficult for us to achieve that scale through additional acquisitions. We also knew that the time was right to focus more of our management energies on our cable business, which currently has more than $3 billion worth of pending acquisitions.”
