While others are shopping for the latest feature-packed smartphones, Atlanta-based CiG plans a flurry of purchases of the structures that will carry those data-laden signals.
Paul McGinn, president and CEO of CiG, told AGL Link that his company plans multiple closings by the end of the year on a weekly basis to increase our tower counts with the goal of getting to the position of the fourth-largest towerco.
In August, CiG acquired Liberty Towers and Southern Tower Antenna Rental (STAR), which together included 38 fully constructed communications towers and 252 works-in-progress sites.
The Liberty transaction was completed for $33.7 million, paid in cash and shares of common stock of the company. The STAR acquisition, which includes 28 fully constructed communications towers, was consummated in cash for $12.5 million. CiG will have 140 completed towers on its books at the end of the third quarter.
“We are an acquisition-based tower company we will leave the construction to the smaller companies around the United States and then buy those towers when they are completed,” McGinn said. In June, CiG acquired six towers for $1.6 million from ClearTalk, a Florida-based wireless telecom concern. In September 2012, CiG purchased an undisclosed number of towers and assets from Towers of Texas for $3.5 million.
CiG’s short-term plan is to amass a portfolio of macrocellular towers in order to maximize the amount of tenant cash flow.
“We are truly a big tower company. We are focusing strictly on large-scale towers,” McGinn said “Big towers produce the most amount of cash flow from multiple carriers.”
Small cells are not currently on the front burner for CiG, according to McGinn, because of the need for a core tower business to support the small cell infrastructure.
“We don’t offer small cell or DAS technology,” he said. “They are definitely on the horizon for us. Those are side business that will develop over time.”
CiG Wireless is a publicly traded company, which was started around two years ago, specializing in managing cell towers and leasing antenna space to wireless carriers. It plans to grow through acquisitions, as opposed to build-to-suit or build-to-own strategies, with the goal of becoming the fourth-largest tower company.
“We are a relatively small tower company with growth plans to reach a couple of thousand towers in the next two to three years,” McGinn said.
In August, CiG completed a $35 million preferred stock financing agreement with Fir Tree Partners, a New York-based private investment fund. Up to $25 million in additional investment from Fir Tree may be used for additional acquisitions. In September 2012, the towerco closed a credit facility with Macquarie Bank for up to $150 million.