Crown Castle sells fiber assets in an $8.5 billion deal to two entities

Crown Castle announced on Thursday that it would sell its fiber and small cells businesses to two entities for $8.5 billion, following the activist investor Elliott Investment Management's push.

The fiber company announced that it would sell its fiber solutions and small cell business to Zayo Group Holdings for $4.25 Billion each.

Shares of the Houston-based company increased 2% during extended trading.

Crown Castle began exploring options for the fiber assets it owned after a deal was reached with Elliott who had criticized Crown Castle for its underperformance. In December 2023, two of the company's directors will be replaced as part of the agreement.

In the month prior, Jay Brown, the former CEO of the company, resigned. Elliott had disclosed an investment in the company worth about $2 billion and wanted to change the leadership.

Crown Castle estimates site rental revenues between $3.99 and $4.03 Billion in 2025, compared to estimates of $6.23 Billion.

After the closing of the deal, it is expected that the company will implement a $3 billion share repurchase plan. The company is expected to cut its annualized dividend from approximately $4.25 to around $4.25 in the second quarter 2025.

The company stated that the transaction should close in the first six months of 2026.

(source: Reuters)