AT&T mulls sale of wireless towers
Washington, September 21, 2013
AT&T Inc is exploring options such as a sale of its wireless broadcast towers but noted that its ability to reach a deal would depend on the terms it is able to reach with the buyer for its ongoing use of the towers.
When wireless service providers sell broadcast towers they typically lease back space from tower operators so they can continue to offer their services without interruption.
Bloomberg reported earlier this week that AT&T had hired bankers for a sale of its towers that could fetch about $5 billion.
Potential acquirers could include Crown Castle International Corp, American Tower Corp and SBA Communications Corp.
AT&T also said it expects record third-quarter smartphone sales, driven by new marketing programs and new devices. It expects to increase its smartphone base by more than 1 million in the quarter.
Operators including AT&T tend to report lower wireless profit margins in quarters of strong smartphone sales as they typically subsidize devices for customers who in turn commit to two-year contracts.
However, it forecast fewer smartphone upgrades in the fourth quarter compared with the year-earlier quarter, partly due to its higher expectations for the third quarter.
The company expects to reach 10 million total U-verse subscribers by the end of the third quarter and expects consumer wireline revenue growth for the third quarter to be consistent with second quarter 2013.
By the end of the third quarter AT&T also said it expects to reach 10 million total subscribers to its U-verse service, which includes home broadband and video. It said it expects consumer wireline revenue growth consistent with the second quarter.
However, AT&T cautioned that it is seeing pressure on legacy services and its overall wireline business revenue growth due to macroeconomic weakness even as its strategic business services are selling well.
The operator said that it is not changing its full-year 2013 guidance from January when it forecast earnings per share growth in the upper-single digit percentage range or higher and revenue growth exceeding 2 percent.
AT&T shares rose slightly in after-hours trade to $34.39 after closing at $34.32 on the New York Stock Exchange on Friday.-Reuters