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TPG in Advanced Talks to Acquire Crown Castle's Fiber Unit

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According to people familiar with the matter, private equity firm, TPG is in advanced talks to buy Crown Castle, Inc.’s (CCI - Free Report) fiber business for $8 billion.

Per Bloomberg, the deal for the fiber and wireless assets is expected to be announced in the coming weeks. No final decision has been made and there is a chance that the ongoing discussions may not succeed or a different buyer might appear.

Over the past few years, private equity firms have been actively investing in fiber and digital infrastructure companies to facilitate their expansion efforts. Crown Castle's wireless portfolio includes a network of small cells, which are small antennas that boost the capacity of wireless networks. These small cells are interconnected via fiber optic cable.

The potential sale would enable Crown Castle to focus on its core towers business, which consists of more than 40,000 towers across the United States as of Sept. 30, 2024.

In October 2024, TPG, along with fiber network owner Zayo Group, was in contention for the acquisition of this business as reported by Reuters.

Shares of this Zacks Rank #2 (Buy) company have declined 6% in the past six months against the industry’s 1.7% growth.

 

Zacks Investment Research
Image Source: Zacks Investment Research

 

Other Stocks to Consider

Some other top-ranked stocks from the broader REIT sector are Highwoods Properties (HIW - Free Report) and Alexander’s (ALX - Free Report) , each carrying a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for Highwoods Properties’ 2024 FFO per share has been raised marginally over the past month to $3.62.

The Zacks Consensus Estimate for Alexander’s current-year FFO per share has moved northward 8.7% over the past two months to $14.84.

Note: Anything related to earnings presented in this write-up represents funds from operations (FFO), a widely used metric to gauge the performance of REITs.


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