8-KMaterial AgreementsFinancial EventsOther Events+1

CROWN CASTLE INC. 8-K Report, Material Agreement (Feb 3, 2012)

Filed February 3, 2012For Securities:CCI

Summary

Crown Castle International Corp. (CCI) filed an 8-K on February 3, 2012, primarily to disclose the entry into a significant new credit facility and the completion of an acquisition. The company secured a new $3.1 billion credit facility, comprising a $1.0 billion revolving credit facility maturing in 2017, a $500 million delayed-draw term loan A facility maturing in 2017, and a $1.6 billion term loan B facility maturing in 2019. This new facility was used, in part, to prepay existing debt and fund the acquisition of certain subsidiaries of Wireless Capital Partners, LLC (WCP), which holds ground lease related assets. The WCP acquisition involved approximately $176 million in net cash consideration and the assumption of roughly $320 million in debt through Secured Wireless Site Contract Revenue Notes. This strategic move expands CCI's asset portfolio. The report also details the termination of the previous credit facility as a result of entering into the new one. Investors should note the substantial new debt financing and the implications for the company's leverage and future growth plans, including potential further acquisitions.

Key Highlights

  • 1Entry into a new $3.1 billion credit facility on January 31, 2012.
  • 2The new credit facility includes a $1.0 billion revolving credit facility, a $500 million term loan A, and a $1.6 billion term loan B.
  • 3Proceeds from the new facility were used to prepay existing indebtedness under a previous credit agreement.
  • 4The company consummated the acquisition of certain subsidiaries of Wireless Capital Partners, LLC (WCP) for approximately $176 million in cash and assumption of $320 million in debt.
  • 5The WCP acquisition adds approximately 2,230 ground lease related assets to Crown Castle's portfolio.
  • 6The previous credit facility was terminated concurrently with the effectiveness of the new credit facility.
  • 7The report details the terms, maturity dates, interest rates, and covenants associated with the new credit facility and the assumed WCP debt.

Frequently Asked Questions

The new credit facility provides for aggregate commitments of $3.1 billion, consisting of a $1.0 billion senior secured revolving credit facility (Revolver), a $500 million delayed-draw senior secured term loan A facility (Term Loan A), and a $1.6 billion senior secured term loan B facility (Term Loan B).

A portion of the Term Loan B proceeds were used to prepay existing indebtedness, pay cash consideration for the acquisition of certain WCP subsidiaries, and cover transaction costs. Remaining proceeds from Term Loan B and Term Loan A may be used for the proposed acquisition of NextG Networks, Inc., related transaction costs, and general corporate purposes. The Revolver is for general corporate purposes.

As part of the WCP acquisition, Crown Castle assumed approximately $320 million of debt in the form of Secured Wireless Site Contract Revenue Notes, Series 2010-1, issued under a specific indenture and supplement.

The Revolver matures on January 31, 2017. The Term Loan A also matures on January 31, 2017, and will amortize over its term. The Term Loan B matures on January 31, 2019, and will amortize at 1% per year.