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Key Takeaways
- Verizon and broadband tower company Vertical Bridge signed a 10-year lease deal worth $3.3 billion.
- The agreement gives Vertical Bridge exclusive rights to more than 6,000 towers in the U.S. from subsidiaries of Verizon.
- Verizon said the transaction was part of its efforts to reduce tower-related costs.
Verizon Communications (VZ) struck a $3.3 billion lease agreement with Vertical Bridge, the largest private owner and operator of broadband towers in the country.
Verizon said Vertical Bridge would obtain exclusive rights “to lease, operate and manage 6,339 wireless communications towers across all 50 states and Washington, D.C. from subsidiaries of Verizon.” It added that the transaction includes upfront proceeds of about $2.8 billion.
The deal provides for a 10-year lease back capacity on the towers, with Verizon as the anchor tenant, and that arrangement could be extended to 50 years. As part of the deal, Verizon will get access to additional space on the towers for its future use, subject to certain restrictions.
The company said the move was part of Verizon’s efforts “to drive down tower-related costs and provide greater vendor diversity in a concentrated industry.”
The transaction is expected to close by the end of this year.
Shares of Verizon edged 0.1% higher in intraday trading Monday. They’ve gained about 19% since the start of the year.
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