iHeartMedia acts to help pare down its debt by selling up to $400 million worth of their towers.
Vertical Bridge, a company that specializes in cellular tower leasing, will acquire an undisclosed amount of iHeart’s tower sites and lease them back to the company. The sale will go towards the billions of dollars in debt owed by the company over the next few years.
iHeartMedia, Inc. (OTCBB: IHRT), one of the leading global media and entertainment companies, announced today the sale of a select portfolio of its tower assets to Vertical Bridge for up to $400 million. The transaction is subject to due diligence and other customary closing conditions.
The transaction is expected to close in Q1 2015. There will be no impact on the company’s broadcast capabilities and operations; at closing, the company will enter into a lease with respect to the sold tower assets that will ensure the ability of its broadcast operations to continue without interruption. The company also advised that investors should expect incremental lease expense as a result of the transaction.
“This is a great example of how we continue to optimize our balance sheet and maximize liquidity — and how we continually review our entire portfolio of assets to ensure we operate them in the most efficient way possible and invest our resources in the highest return opportunities,” said Richard J. Bressler, President and Chief Financial Officer of iHeartMedia, Inc.
“We are excited to add this high quality tower portfolio to our existing assets,” said Alexander L. Gellman, CEO of Vertical Bridge Holdings, LLC. “We are looking forward to a strong partnership with iHeartMedia. In addition to being a premier broadcast portfolio, these sites already have many broadband telephony and data tenants and the capacity and potential to add many more. With this latest transaction, Vertical Bridge now has approximately 2000 revenue producing sites that are owned or under definitive agreement.”