Grain Management, a private equity firm focused on the telecommunications industry, is preparing a $196.5 million securitization of wireless spectrum lease payments, according to a presale report published by Kroll Bond Rating Agency.
Proceeds from the transaction, Grain Spectrum Funding II, will be used to purchase five licenses from Cincinnati Bell Wireless. The licenses will then be leased to Verizon Wireless over a 20-year period. The lease is a “hell-or-high-water” contract which provides extremely limited instances in which Verizon is able to rescind its obligation. The carrier must make quarterly lease payments with an annual 2% escalator throughout the life of the lease.