Phoenix Tower International (PTI), an independent tower company operating in the Americas and Europe, which is backed by Blackstone, today announced that it has closed two transactions, including the: i) purchase of 202 towers in the United States through the acquisition of a 100% ownership interest in Tower Ventures Holdings III, LLC and ii) acquisition of 100% of Technology Associates EC Inc (TAEC), a provider of wireless infrastructure services in the Western United States, from Optimal Investment Group, a private equity firm.
Tower Ventures – Overview
Tower Ventures is a Memphis, Tennessee-based cellular tower operator that owns and manages a total of 850 wireless communications sites in the United States. The company’s shareholders include its management team and BBH Capital Partners, a private equity strategy of Brown Brothers Harriman & Co.
By purchasing Tower Ventures’ subsidiary, Tower Ventures Holdings III, Phoenix Tower has acquired a portfolio of 202 wireless telecommunications sites across the United States, which Tower Ventures previously built.
Notably, this is the second transaction between the parties, following Phoenix Tower’s acquisition of 197 wireless communications towers from Tower Ventures in March 2020. At this prior time, Phoenix Tower acquired Tower Ventures Holdings, LLC and related entities, including Tower Assets Newco IX LLC.
Valuation Approximation
At the time of Tower Ventures’ previous disposition to Phoenix Tower, in March 2020, Tower Ventures stated that it had “built and sold tower portfolios valued at over $600 million dollars”. Roughly two years later, in April 2022, Tower Ventures now states that it has “built and sold tower portfolios valued at over $800 million dollars”.
Assuming that Tower Ventures did not complete any additional tower portfolio sales over the past two years, then these metrics would imply that Phoenix Tower is acquiring Tower Ventures Holdings III for ~$200m. Overall, a ~$200m valuation would equate to a price of ~$990k per tower, for Tower Ventures’ 202 sites.
Technology Associates EC (TAEC) – Overview
Technology Associates EC (TAEC) is a Midvale, Utah-based provider of wireless infrastructure services across 8 states in the Western region of the United States. Through the TAEC transaction, Phoenix Tower expands its geographic footprint in the United States and its offering to include the following services:
- Site Acquisition: site identification, feasibility assessment, leasing, zoning, permitting
- Architectural & Engineering: new cell site design, site modification design, structural analysis, stealth design
- Planning & Permit Services: ensure proposals are coordinated to conform to applicable land use laws
- Project Management: construction analysis, construction coordination & field management, subcontractor & vendor management
- Traffic Control Planning: full traffic control designs, permit drawings, right-of-way permitting services
Also, TAEC brings an additional 90+ telecom professionals to Phoenix Tower, expanding the company’s total workforce in the United States to 200+ employees.
Finally, TAEC’s services business enables Phoenix Tower to vertically integrate, beyond only owning passive infrastructure, to better support its core site leasing business. Particularly, the company’s tower-related services will help facilitate the addition of new tenants and equipment onto Phoenix Tower’s sites. In turn, the company will aim to be a closer partner to its U.S. wireless carrier customers, specifically, as it relates to network densification and the roll-out of 5G.
Transaction Advisor
TAEC’s financial advisor was Bank Street Group.
Phoenix Tower International (PTI) – Overview
Pro forma for Tower Ventures, TAEC, and pending transactions, Phoenix Tower will own and operate over 18.0k cellular towers and 613 miles (986 kilometers) of fiber. Geographically, the company’s digital infrastructure portfolio spans 18 countries throughout the United States, Europe, Mexico, South America, Central America, and the Caribbean.
Phoenix Tower’s key shareholders are Blackstone Infrastructure Partners (BIP), which acquired a 35% stake in the company, in January 2022, as well as Blackstone Tactical Opportunities (Tac Opps), which has been an investor in Phoenix Tower since 2014.
