Crown castle, Lumen reportedly closer to selling their fiber networks

　　Crown castle may be nearing a sale of its fiber operations to TPG for around $8 billion. Separately, Lumen has reportedly kicked off a sales process for its fiber network that could be worth up to $9 billion.

　　Buyers are circling the fiber networks of both Crown castle and Lumen Technologies, according to a handful of reports.

　　Reuters reports that Lumen has officially kicked off a sales process for its consumer fiber operations with investment bankers at Goldman Sachs in a deal that could be worth between $6 billion to $9 billion. Lumen's stock rose slightly on the news.

　　In a separate Bloomberg report, global alternative asset management firm TPG is in "advanced talks" to buy the fiber business of cell tower operator Crown castle for around $8 billion. Shares in Crown castle have steadily been falling this week.

　　The developments indicate that the pace of fiber mergers and acquisitions in the US continues to accelerate. In just the past few months Verizon bid $20 billion for Frontier, T-Mobile formed joint ventures with Lumos and Metronet, and Canada's BCE struck a deal to acquire Ziply Fiber.

　　But both the Lumen and Crown castle transactions face difficulties.

　　For example, the analysts at MoffettNathanson noted that just 19% of Lumen's "mass markets" wireline network footprint has been upgraded to fiber, compared with 49% at Frontier and 65% at Ziply. "That introduces execution risk and a big capex burden," the analysts wrote in a recent report.

　　Lumen officials for months have been discussing the possibility of offloading the company's mass markets division, either through a sale, joint venture or other transaction. Lumen's mass markets business contained 2.6 million residential and small business customers at the end of the third quarter of 2024. Roughly 1 million of those customers were on fiber connections; the rest were on the operator's copper network.

　　As for Crown castle, the company first kicked off a "strategic review" of its fiber business toward the end of 2023. That effort also includes the sale of its small cell operations. Together, the two businesses were valued at a combined $15 billion.

　　But, according to Bloomberg, TPG is only pursuing Crown castle's fiber operations.

　　TPG is no stranger to the telecom and media business. The firm is currently working to close its acquisition AT&T's 70% stake in DirecTV.