Macquarie Buys U.S. Wireless Tower Company
Shu-Ching Jean Chen, 07.02.07, 2:49 AM ET

HONG KONG -
Macquarie, Australia's largest investment bank, is making inroads into the
large yet underdeveloped wireless telecom infrastructure market in the U.S.,
agreeing to buy the wireless tower operator Global Tower Group for 1.7
billion Australian dollars ($1.43 billion) from Blackstone Group.

Since its founding in 2003 by real estate and telecom entrepreneur Marc C.
Ganzi, Global Tower has built a portfolio of 2,500 signal-relay towers and
4,600 rooftop sites across the U.S. and Puerto Rico, securing long-term
leases from property owners. Some 86.5% of its leases are for longer than 15
years and 89% are unburdened by complicated revenues-sharing arrangements.

The U.S. mobile telecom industry's Big Four - T-Mobile from Deutsche
Telekom, Verizon, Sprint Nextel and AT&T - will account for about 63% of
Global Tower's revenue following the completion of AT&T's acquisition of
Dobson Communications, a major Global Tower customer.

With a relatively low rate of adoption of advanced wireless services such as
3G, Wi-Fi and Wimax, the U.S. is seen as having potential to be a
high-growth market. The U.S. has a penetration rate of 77% for these
services, behind the U.K.'s 117%, Sweden's 110%, Taiwan's 102%, Australia's
95% and Japan's 78%.

"Through this acquisition, Macquarie Communications Group has gained a
timely position in a familiar industry in the attractive U.S. market," said
Scott Davies, CEO of Macquarie Communications.

Macquarie Infrastructure Partners will hold 56.2% of Global Tower and
Macquarie Communications Infrastructure Group will take 28.7%.

Davies added that Global Tower would complement with its existing North
American assets bases of satellite dish facilities in Los Angeles and
Washington operated by its subsidiary Arquiva, a British wireless telecom
services provider of broadcast towers, teleports, and wireless
infrastructure.

There are 115,000 wireless towers in the U.S. operated by a disparate range
of companies, but 45% are now in the hands of three companies: Global Tower
and its rivals Crown Castle International and SBA Communications, according
to Macquarie.

The weighted average remaining ground lease term in the industry is a
staggering 24 years. Such long lease terms pose high entry barriers to new
entrants who do not go in via acquisitions.

The acquisition, when completed, would account for a small 3% share of
Macquarie Communications' EBITDA and would not affect its existing dividend
distribution guidance of about 10% growth for fiscal years of 2008 and 2009
and between 5% and 10% for 2010.



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