American Tower breaks into Canada with InSite Wireless acquisition for $3.5 billion

Today American Tower Corporation (ATC) has announced an agreement to purchase InSite Wireless Group for $3.5 billion including debt.

 

The deal will see them acquire roughly 3,000 sites, including 1,400 owned towers in the US and 200 in Canada. It also includes 600 land parcels under communications sites and around 400 rooftop sites.

 

“This transaction augments our foundational U.S. business through the addition of a well-run, high-quality, complementary, macro-tower focused portfolio, while also marking our entry into Canada,” said American Tower’s CEO Tom Bartlett. “We believe that these assets are positioned to enhance our organic growth and cash flow trajectory in the future as 5G deployments accelerate and densification initiatives progress.”

 

ATC expects InSite’s assets to generate around $150 million in property revenue and around $115 million in gross margin in the first year.

 

As always, the deal is subject to regulatory approval, but is expected to close before the end of the year.

 

While this acquisition represents a huge investment, it represents just a fraction of ATC’s overall portfolio, which spans around 181,000 communications sites, many of which it leases to major carries like AT&T and Verizon. 

 

Telecoms infrastructure is being sold like hotcakes at the moment all around the world, with both the coronavirus and the emergence of 5G driving investment. ATC is one of the companies currently benefiting from this increased digital demand; at the end of last month the company once again raised its quarterly dividend having posted positive results for Q3, with Bartlett noting that the company had seen strong demand across its global portfolio as a result of the challenges operators faced during the coronavirus pandemic.

 

Similar stories can be seen in Europe, with Spanish operator Cellnex also on an infrastructure shopping spree, having more than doubled its portfolio since the start of the year. The company is currently in talks to purchase CK Hutchison’s European tower assets for €9 billion.