A Greater Cincinnati wireless communications company has landed a $50 million investment – a deal that stands as the largest equity raise in the region in 2021 – as it looks to expand its footprint nationally.
Arcadia Towers Group, a Milford-based developer, owner and manager of communication tower infrastructure and rooftop sites, said New York-based SDC Capital Partners has committed up to $50 million of equity capital to amplify its growth trajectory.
The deal, announced this week, stands as the region's largest publicly disclosed raise this year and positions Arcadia as one of the larger mid-market companies in its industry, Sam Johnston, Arcadia co-founder and CEO, told me. Standard Bariatrics, a Blue Ash-based medical device startup, landed a $35 million Series B in June, while Kurome, a Cincinnati Children’s spinoff that develops new therapies to treat cancer, closed a $15 million round last month.
The funding from SDC is a recapitalization for the company. Arcadia, founded in 2005, sold its first portfolio of 22 tower assets to American Tower (NYST:AMT) in 2012 for $17 million. And in 2019, it sold a 12-site portfolio to InSite Wireless for $8 million.
After the latter deal, Johnston said he wanted to take a more long-term approach. SDC, he said, mirrored that philosophy. Discussions between the two started about a year ago.
With the advent of 5G, which promises faster download speeds, among other benefits, additional site locations, like municipal properties and schools, parks and commercial rooftops, are even more critical, as the technology starts to densify, he said. Arcadia leases space on those towers to wireless service providers like Verizon, T-Mobile and AT&T.
“The SDC team brings a wealth of operating experience and focus on digital infrastructure that aligns with Arcadia’s long-term strategic plan,” Johnston said. “Tower assets are very expensive – it can cost upwards of over $350,000 to develop a single tower site. SDC’s investment allows us to aggressively develop and acquire the wireless sites needed by our carrier-customers.”
Arcadia said it has four specific strategic initiatives for the capital, including:
- Municipal and school district partnerships
- Acquisitions of existing tower assets
- Carrier build-to-suit services
- Rooftop management for commercial real estate owners
The company plans to extend beyond its traditional regional footprint of Ohio, Kentucky and Indiana.
Johnston said Arcadia is in the process of acquiring assets through private negotiations. The company is also working with a couple of commercial real estate owners – one deal is expected to close soon – and is in early discussions with several school districts and municipalities.
As part of its relaunch, Arcadia has moved into new office space in the 20 Brix building in downtown Milford.
Executives John Rolander and Scott Billups also joined Arcadia’s management team in August: Rolander as chief development officer, responsible for the company’s private public partnership program with school districts and municipalities, and Billups as CFO, overseeing the company’s financial and M&A activities.
Rolander most recently served as a managing director of capital markets and municipal underwriting in the public finance industry, including Hilltop Securities and Fifth Third Securities Inc. Billups has served in the CFO role for private multiple equity-backed portfolio companies in the financial services industry, and has experience as a senior finance executive with public companies.
