Article Highlights
- Board Dynamics And Evolution: Overcoming Initial Resistance
- Purchase Price And The Decision To Sell: A Strategic Move
- Four-Carrier Site With No ROFR: A Desirable Asset
- Expertise And Efficiency
This case study delves into the details of Symphony’s latest success story in the complex landscape of telecommunications, centering around the acquisition of the cell site at University Drive, operated by Walsh College. The narrative unfolds against the backdrop of an American Tower site with four carriers and a unique set of circumstances that presented Symphony with an opportunity to showcase its efficiency and value-adding approach.
The cell site at University Drive presented Symphony Wireless with a unique opportunity. Walsh College, a small liberal arts school, had its cell site infrastructure managed by American Tower, featuring four carriers. This scenario set the stage for a complex yet promising acquisition, with Symphony aiming to navigate the intricacies of the transaction to the benefit of both parties.
Board Dynamics and Evolution: Overcoming Initial Resistance
One of the challenges Symphony faced early on was the resistance from previous board members at Walsh College who were against selling the income-generating cell site. However, a significant turning point occurred when the board underwent a revamp. The new board members assessed the situation differently and recognized the potential to cash out the income stream from the cell site, leading to a shift in the overall stance of Walsh College. The new board members were focused on renovations, new department buildings, and plenty of long-overdue projects that required funds that the school simply did not have.
Symphony Wireless offered three key things that could make this new boards’ objective come to life:
- Significant cash buyout.
- An opportunity to harness a 1031 or 544 exchange to defer taxes to start and pay for projects in the short-term.
- A long-term partner that would aim to grow an already popular cell site and share that revenue with the school over time.
Purchase Price and the Decision to Sell: A Strategic Move
With the board’s new perspective, Symphony Wireless initiated discussions regarding the sale of the cell site. The negotiation process resulted in a $1.2 million purchase price– a figure that reflected the strategic value of the site and the income it generated. Symphony’s ability to communicate the long-term benefits of selling, coupled with the board’s newfound openness, paved the way for a mutually agreeable purchase price.
Four-Carrier Site with No ROFR: A Desirable Asset
One of the key attractions of the University Drive site was the fact that it was an American Tower site hosting four carriers – a valuable asset in the wireless infrastructure space. Furthermore, the absence of a Right of First Refusal (ROFR) added to the desirability of the property and allowed a sale to happen. This clause in many sites allows the steel builder to outbid any potential purchaser without recourse, thus making the number of potential buyers smaller and their potential offers even smaller.
If you have a cell site without a ROFR you are uniquely positioned for success; and if you aren’t sure, Symphony’s acquisition advisors are the partners you need to help you figure out your next move in creating value.
Expertise and Efficiency
In a notable display of efficiency, Symphony Wireless identified an opportunity to expedite the transaction timeline. The opportunity to complete due diligence and close the deal within 14 days presented itself. Symphony, recognizing the importance of speed in such transactions, seized the opportunity and successfully executed the acquisition within the accelerated timeframe. This efficient approach not only showcased Symphony’s agility but also minimized disruptions to Walsh College’s operations.
DISCLAIMER
The foregoing case study has been fictionalized in certain respects to protect the identities of the parties. Past performance is not indicative of future results. Symphony Wireless does not provide tax, accounting of estate planning advice. Interested parties are encouraged to consult your own legal and tax advisors.
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