EDINBURG, Va. - Shenandoah Telecommunications Company (NASDAQ:SHEN), commonly known as Shentel, has entered into an agreement to sell its portfolio of 226 tower sites to Vertical Bridge Holdco, LLC for $310.3 million in cash. The transaction, which is subject to customary closing conditions, is expected to see an initial closing in March 2024.
Shentel's tower portfolio, which includes 218 macro cellular towers and 8 small cell sites, generated $18.6 million in revenue and $11.6 million in Adjusted EBITDA in 2023. The company anticipates paying up to $10 million in income taxes for the 2024 fiscal year due to the gain on the sale, after utilizing net operating loss carryforwards.
The sale marks a strategic move for Shentel, as the proceeds are intended to bolster the expansion of its Glo Fiber line of business, aiming to reach approximately 600,000 homes and business passings by the end of 2026. Alongside the tower sale, Shentel is also in the process of acquiring Horizon Telcom, supported by $356 million in committed financings, which the company believes will create a well-balanced capital structure and provide financial flexibility.
Vertical Bridge, the largest private owner and operator of communication infrastructure in the U.S., views the acquisition as an opportunity to add high-quality assets with available capacity for additional tenants. The towers, located in areas with zoning and terrain challenges, are considered valuable for the deployment of existing and new technologies.
Both companies have secured financial and legal advisors for the transaction, with Rothschild & Co and Lape Mansfield Nakasian + Gibson, LLC advising Shentel, and Truist Securities, Inc. and Greenberg Traurig, LLP advising Vertical Bridge.
This press release contains forward-looking statements about Shentel's business strategy and financial position, and actual results may differ materially from those contained in or implied by these statements due to various factors. More details about the transaction can be found in Shentel's Form 8-K filed with the Securities and Exchange Commission.
The information provided is based on a press release statement from Shenandoah Telecommunications Company.
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