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Crown Castle International (CCI) (NYSE:CCI) began its corporate existence in 1994 owning 133 communication towers in southwest Texas. Today, many deals later, the Company controls a portfolio of 11,000 tower and rooftop sites in the U.S. as well as 1,300 sites in Australia. Berkshire, along with Denver-based Centennial Funds, were the original investors supporting this remarkable growth story. Over the 11 year course of this relationship, Berkshire, who still maintains board representation, made multiple investments supporting the initial domestic growth strategy, played a key role with capital and advice in CCI's hugely successful acquisition of the British Broadcasting Corporation's (BBC) tower and broadcast assets (since divested), and ultimately made yet another confidence boosting investment in the Company during a period of industry-wide concern over excessive financial leverage, which has since been happily resolved. Berkshire is very proud of its contributions to the success of CCI.

What did CCI seek from a private equity partner?

When CCI was launched, its founders knew that they had a big idea. Wireless communications were showing signs of robust growth, and the capital intensity of the required network build out meant that the early wireless carriers had to think creatively about how to redeploy the capital that had already been sunk into networks assets. The emergence of the tower companies met this need as they facilitated large financial transactions that enabled the wireless carriers to extract capital from their tower assets to be reinvested in other aspects of their rapidly growing businesses. The CCI founders knew they could be an early leader in this process if properly supported by financial partners who could act decisively and quickly to motivate the large amounts of capital necessary to ensure CCI's ability to participate in every sale process involving large tower portfolios. As a result, they sought an equity partner capable of providing analytical and strategic resources, credibility with sellers and their financial advisors, and the commitment to bring a focused effort to CCI to facilitate their company-building activities.

Berkshire's role

Berkshire worked side by side with management to build the analytical and operating tools required to participate in the industry consolidation, to accurately show the capital markets the potential of such assets, and to ultimately help enable the Company to transition to public ownership through its 1998 IPO and subsequent sales of equity securities. Berkshire's team remained in place through the entire period, and was augmented as necessary. Today CCI believes it is the most advanced tower network operator with industry leading customer satisfaction.

In addition to the substantial domestic acquisition activity, Berkshire also played a key role facilitating the successful 1997 purchase of the BBC's tower and broadcast facilities. We worked alongside management to organize the investment capital necessary to perform in the U.K., ultimately helping to ensure CCI's leading role in the process. The BBC assets, once acquired, were operated on a stand alone basis until they were merged into CCI at a later date. These same assets were divested by CCI in 2004 culminating a very successful ownership period for the shareholders of CCI.

Outcome

CCI is an excellent example of the results that are possible when a big idea is properly supported by motivated partners. There was a true partnership between management and investors through the key early domestic acquisitions made by CCI, and especially during the ground breaking effort to prove to the BBC that CCI was a worthy outsourcing partner with the operating skills and capital necessary to ensure continued smooth operation of their critical transmission assets. All of this hard work has resulted in many good relationships and many happy investors.