Easter weekend was apparently a fruitful one for fiber infrastructure M&A work, as we have another deal to look at this morning. Crown Castle International has announced a definitive agreement to buy Wilcon.
Wilcon operates a regional network in southern California around the Los Angeles and San Diego metro areas that spans some 1,900 route miles. After acquiring Freedom Dark Fiber and lighting those assets, Wilcon has been actively investing in densifying its network and taking on larger and larger projects. Recently they've seen small cell deployments driving their expansion in multiple places, and thus we can see some immediate overlap with Crown Castle. That being said, the deal will also bring Crown into closer contact some new verticals, e.g. the entertainment space in which Wilcon offers connectivity to and between studios and related businesses in southern California.
Crown Castle bought a substantial amount fiber in southern California as part of the Sunesys deal several years ago, so it's not their first trip into the region. This acquisition will give them a much broader and deeper presence to take to market. It comes pretty closely on the heels of their announced acquisition of FPL FiberNet almost six months ago, reflecting the company's growing appetite for the fiber business. Just this past weekend they have been linked to a possible bid for Lightower in the northeast.
According to the SEC filing, the purchase price was $600M. Crown Castle expects the deal to contribute $40M to gross margin and $10M to general and administrative expenses.
Below are two screen grabs from their supplemental information on the deal that illustrate the complementary asset fit, with Wilcon in orange and CCI's existing footprint in blue:
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