Verizon Communications (Verizon) has entered into a USD 3.3 billion agreement with Vertical Bridge to lease, operate, and manage 6,339 wireless towers across all 50 states and Washington, DC from subsidiaries of Verizon. The deal, structured as a prepaid lease, will provide Verizon with USD 2.8 billion in upfront cash, the companies announced on Monday.
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Verizon-Vertical Bridge Agreement
Under the terms, Verizon will enter into a 10-year agreement to lease back capacity on the towers from Vertical Bridge, serving as the anchor tenant, with options that could extend the lease term up to 50 years. Verizon will also have access to certain additional space on the towers for its future use, subject to certain restrictions.
This agreement, along with Verizon's existing build-to-suit joint venture with Vertical Bridge, is aimed at cutting costs and increasing vendor diversity in the tower market.
Tower Market and Vendor Diversity
Verizon said, "This transaction builds on our existing relationship with Vertical Bridge while realising substantial value for this unique set of assets and allows us to be agile in optimising the network with one of the best operating partners."
"We are pleased to have been selected by Verizon as the counterparty in the largest US tower transaction in almost a decade," said Vertical Bridge. "This transaction represents a significant step for Vertical Bridge. The vision of the company founders 10 years ago was to create a permanent, private, and at-scale US tower company."
"This transaction marks a significant milestone in the realisation of that vision. Upon the completion of this transaction, these assets, together with our existing portfolio which includes thousands of young, purpose-built towers, enhance Vertical Bridge's position as a fast, friendly, and flexible colocation partner to the wireless industry."
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Vertical Bridge
Vertical Bridge is backed by DigitalBridge, a global investment firm, and CDPQ, an important shareholder. The transaction is expected to close by the end of 2024, subject to customary closing conditions.
