American Tower (AMT) announced on Thursday that is has agreed to merge with American Tower REIT, Inc. and hopes to have the REIT designation applied to all company shares by January 1st of 2012. A shareholder meeting will occur on November 29th of this year to vote on the plan.
As stated previously, I expect the conversion to attract new investors to AMT primarily based on dividend distribution. A large group of investors are in search of income investments. In AMT’s case they will find an income stream and technology play. AMT would be one of, if not the first, cell phone tower company to move into the REIT arena.
AMT poses a distinct opportunity for income investors. They would be able to position themselves in a way to benefit from the growth in wireless usage across the globe, while being heavily shielded from product cycles and consumer trends.
In addition, I continue to see AMT as a company with the experience and capital necessary to make in-roads in under-served parts of the world, such as Africa. Africa is a nation that is developing and will not receive the infrastructure that developed countries have in the way of ground transmission lines. Why put a line into every home when wireless is available?
AMT has begun to expand into Africa. This spring the company acquired 440 tower sites in South Africa for $60 million. AMT is also considering to acquire up to an additional 1,800 towers in Africa in the next 2-3 years.
The company’s stock has held its ground well throughout August, even during the days that the market was rocked the hardest. As an investor, I am very interested in learning more about this company in terms of its financial stability.
It’s time to do some research and look forward to the shareholder meeting on the 29th of November.