Sold

Uniti Group, the telecom real estate investment trust (REIT) spun off from Windstream several years ago, said it has sold its “remaining investment interest” in Bluebird Network, as well as fiber and other network assets previously leased to CableSouth, which also operates as SwyftFiber. In addition, Uniti sold “essentially all” of its remaining wireless towers to CTI Towers.

The CableSouth/SwyftFiber assets were sold back to that company, which operates in parts of Louisiana, Arkansas and Mississippi. Uniti said it will continue to have access to certain fiber strands at zero cost.

Telecompetitor talked with Bluebird Network CEO Michael Morey, who told us that investment firm Macquarie has owned the company for several years. In 2018, Macquarie sold Bluebird’s fiber network assets to Uniti, which leased them back to Bluebird. The next year, Macquarie bought back 80% of those assets. The transaction that Uniti referenced in its announcement this week involved the remaining 20% and was completed in December, Morey told us.

Uniti said total cash consideration for the three transactions was approximately $87 million. For the 12 months ended September 30, 2023, the combined revenue for the assets was approximately $4 million and the adjusted EBITDA was $9 million.

In a prepared statement, Paul Bullington, Uniti senior vice president, chief financial officer and treasurer, said “Uniti has consistently proven to be both a disciplined buyer and seller of assets, and these transactions are further examples of recycling capital at attractive valuations, while also strengthening our overall balance sheet.”

The Leaseback Business

Uniti, originally known as Communications Sales & Leasing, was initially comprised of fiber and copper network assets spun off from Windstream in 2015. Windstream continued to use the assets, which were then leased from Communications Sales & Leasing. Windstream’s goal was to free up capital for network investment.

The name change to Uniti occurred in 2017.

Over the years, Uniti has expanded both its asset holdings and the base of companies to which it leases connectivity.

Uniti reached a sale leaseback deal with CableSouth in 2018 that was quite similar to the one with Windstream.

The Bluebird fiber assets acquisition came in 2019. Bluebird Network was established through a 2011 merger of Missouri Network Alliance, a statewide network owned by more than a dozen independent telcos, and Bluebird Media, a company that won a broadband stimulus grant to build a middle mile network in the area. At that time, the network covered portions of Missouri, Kansas, Illinois and Oklahoma. It now reaches portions of several other states located in the central U.S.

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