American Tower Corp. is prepping $875 million of notes backed by cell tower leases, according to Fitch Ratings.
The offering consists of $175 million of Secured Revenue Notes Series 2015-1 with an anticipated repayment date of June 2020 and 2015-2 and $700 million of Secured Revenue Notes Series 2015-2 with anticipated repayment date of June 2025. Both series of notes are rated AAA’ by Fitch.
That’s significantly higher than American Tower, which is rated BBB- by Fitch.
At closing, the issuer will use proceeds, along with additional equity, to retire its $960 million of secured tower revenue notes, including Global Towers Series 2011-1, 2011-2, and 2013-1.
The notes are backed by mortgages representing approximately 94% of the annualized run rate net cash flow of GTP Acquisition Partners I, a wholly owned unit of American Tower, and are guaranteed by American Tower. Those guarantees are secured by a pledge and first-priority-perfected security interest in 100% of the equity interest of both GTP and American Tower.
GTP currently operates more than 96,000 sites in the U.S. (40,000+ sites), Brazil, Chile, Colombia, Germany, Ghana, India, Mexico, Peru, Costa Rica, South Africa, and Uganda. Net cash flow from the original collateral has increased approximately 15% since the 2013-1 issuance primarily due to the contractual rent increases, fixed-cost base structure, and organic growth through escalations and lease-ups.
There are 3,621 tower sites and 8,101 tenant leases spanning 50 states and Puerto Rico. The largest state, Texas, represents approximately 12.9% of annualized run rate of net cash flow.
Barclays Capital is the structuring agent.