Report: Crown Castle emerges as top bidder for T-Mobile's towers

Crown Castle is now the front-runner in the bidding war for T-Mobile USA's cell towers, and may soon strike a deal with the carrier valued at more than $2 billion, according to a Wall Street Journal report.

The report, citing unnamed sources, said that American Tower and Global Tower Partners are still potential bidders, but that Crown has emerged as the leading bidder since final bids were put forward in early July. The Journal report noted that a deal could still fall through and it is unclear how it might be structured. A June Bloomberg report had named Crown and American Tower as companies interested in securing the 7,000 towers T-Mobile owns. 

T-Mobile and American Tower declined to comment, and Crown Castle could not be reached for comment, according to the Journal.

The nation's No. 4 carrier has been looking to sell is towers as a way to raise funds since AT&T (NYSE:T) and Deutsche Telekom aborted their plans late last year for AT&T to buy T-Mobile for $39 billion. DT CFO Timotheus Hoettges has in the past raised the possibility of a tower sale as a way to fund spectrum purchases.

T-Mobile has agreed to an AWS spectrum swap with Verizon Wireless (NYSE:VZ), which would allow T-Mobile to expand coverage to 60 million more people, but which is contingent upon Verizon receiving regulatory approval for its own $3.9 billion AWS spectrum purchase from a group of cable companies. T-Mobile has not said how much it would pay Verizon in the swap. 

Analysts have said T-Mobile could raise $2 billion to $3 billion by selling its towers. A tower sale might also make sense given that AT&T gave T-Mobile a seven-year UMTS roaming agreement that will allow T-Mobile to expand its coverage to 280 million POPs from 230 million.

The tower sale is just one part of T-Mobile's network transformation, which includes a deployment of LTE next year. T-Mobile has installed new, LTE-capable base station equipment at 400 cell sites and said in June that it would grow that number to 2,500 sites by the end of July.

T-Mobile is currently testing LTE network technology and that the carrier will begin testing LTE Release-10 equipment--dubbed LTE Advanced--in the summer. Ericsson (NASDAQ:ERIC) and Nokia Siemens Networks are the vendors for T-Mobile's $4 billion network upgrade project, which includes reframing its 1900 MHz PCS spectrum for HSPA+ service.

For more:
- see this WSJ article (sub. req.)

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