AT&T / CENTENNIAL MERGER
IMPACT ON CELLULAR LEASES
On November 7, 2008, AT&T announced plans to acquire regional cellular operator Centennial Communications for $944 million dollars. Centennial owned spectrum and assets in the Midwest (IN, MI, OH) and Southeast United States (LA, MS, TX) along with spectrum in Puerto Rico and US Virgin Islands. As justification for the merger, AT&T stated in their November 7, 2008 press release that “The acquisition offers opportunities for synergies in areas including corporate overhead, advertising, customer care and network operations.”. Of key importance to landowners with AT&T and Centennial Communications leases should be the last part of that statement- the synergies of network operations. In other words by reducing network operations (switches, towers, cell sites) that are now redundant, AT&T expects to save money in the future.
This means that AT&T will start evaluating the AT&T and Centennial portfolio of cell sites in these areas and determine which are necessary for the network and which can be disposed of. Based upon the results of the AT&T/Cingular merger, Steel in the Air expects that there will be some terminations of both AT&T and Centennial cell tower leases. Steel in the Air also expects that based upon the AT&T/Cingular merger that landowners will be contacted by either Blackdot or Md7 to renegotiate their cell tower leases. If history is any indication, Blackdot Wireless or Md7 will contact a large percentage of landowners with cell tower leases to negotiate modified terms regardless of whether the subject site is actually one that AT&T is certain to keep.
If you are contacted by either Blackdot or Md7 or have concerns about how the AT&T/Centennial merger is likely to impact you, please contact us. We can assist you with evaluating the proposal from Md7 or Blackdot Wireless to see whether it makes sense to renegotiate or simply keep the lease as it is. We can find and evaluate the proximity of other Centennial Communications or AT&T Wireless cell sites in the area using our proprietary cell tower location data as well as alternative research methods. Once we know where the other AT&T or Centennial cell sites are, we can evaluate the risk of termination and help you determine a course of action. Please know that even in cases where we find duplication, it doesn’t always make sense for the landowner to negotiate an amendment to the lease agreement. So if you are aware of a nearby cell site, don’t presume that it automatically means that you should negotiate. We can’t promise that your AT&T or Centennial cell site will be retained, but we can assist you in making sure that you get the maximum amount of revenue from your particular situation.
Lastly, don’t feel pressured to make a decision. It could take some time for AT&T and Centennial to sort out those sites they need and those that they don’t. You have the time to do your research and make an informed decision. Please contact us for a free quote on the cost of our services on reviewing AT&T/Centennial duplication issues.
AT&T AND CENTENNIAL COMMUNICATIONS ARE REGISTERED TRADEMARKS OWNED BY AT&T AND CENTENNIAL COMMUNICATIONS, RESPECTIVELY. STEEL IN THE AIR IS NOT AFFILIATED IN ANY WAY WITH AT&T AND CENTENNIAL COMMUNICATIONS. IF YOU ARE LOOKING FOR AT&T's WEBPAGE- PLEASE GO TO www.att.com/