Possibly the news that local carrier WIN is spinning of a REIT. People wonder how much value could be created if T did the same. I don't see it happening but that might be the reason as there is no other news relevant to T. Go check out WIN.
Let me sum it up for those who may not understand. Windstream is creating a REIT which will then be able to hold infrastructure assets for a telecom that can be leased back to the telecom. Creates a nice little accounting twist which is very advantageous from a tax view. Too bad T already sold a bunch of towers to Crown Castle for 4.85B.
Here is my question though. Those assets become an independent, publicly owned listing. If it is arms length independent then what stops another service provider from bidding for the rights to lease those assets and trump the original REIT creator or driving up costs? That INDEPENDENT company is in the pursuit to maximize investment for its shareholders. My guess would be the telecom spinning off assets would need to keep a controlling share but then how would that be viewed under an IRS determination as a tax basis independent? I'm sure they have worked through the scenario but I'm wanting a little more info. They wouldn't want to lose control of their assets needed when contracts need renewed. Interesting twist today. Believe the market is a little too excited about it though. Independent REIT....In the long view is it truly any different than selling assets to a third party like Crown Castle and leasing them back? Short term cash infusion with the intent to have the equity market capitalize capex instead of the bond market. The independent then controls the pipes to your business. The independent REIT then holds the power wand. Pitfalls to this deal I'm interested to read how they are avoided.