Crown Castle founder Ted Miller issues letter to Chairman on director nominees

Crown Castle founder Ted Miller has nominated a slate of four director nominees to the Crown Castle board of directors and sent a letter on behalf of his investment vehicle Boots Capital Management, to Crown Castle Chairman P. Robert Bartolo. Highlights of the letter include: “…Like you, I believe that Crown Castle must be rebooted after the shameful adventure into fiber, which has cost investors tens of billions and turned the global industry-leader into a ridiculed laggard…Crown Castle lacks leadership, expertise, vision and urgency. It needs a plan. The CEO has resigned, the current CFO has resigned and un-resigned, there is a revolving door of fiber leadership, the EVP/COO of Towers has left, a major employee location has been shuttered and reopened, the company still trades at a 15-20% enterprise-value discount to peers, and the share price reflects skepticism about a potential fiber sale and what comes after. Well, we’ve got a plan…I would serve as Executive Chairman, and Chuck, Tripp and David as directors. We would help the Board and collaborate with both the interim and new CEO to accomplish the following objectives for all stakeholders: Get fiber sold…not one Board member ever asked to see this extensive work…our model anticipates Crown Castle retaining a minority interest..Our models showed that Crown Castle could go all the way to 2050 and never earn back its own cost of capital…There are significant tax benefits, estimated by our accounting advisers at $1B-plus, that expire at the end of 2024…In 2013, Crown Castle owned 40,000 towers and employed 1,400. Today it still owns 40,000 towers and employs 2,200 people across that business line, even after a 750-person reduction…we intend to use digital-twin and AI technology to reduce customer rebalance and rollout times, while reducing service costs by an estimated 40% during the tower lifecycle.Restoring a positive and productive company culture is essential to driving shareholder value…we have a longer-term detailed approach to help customers access new communications infrastructure that captures immense opportunities in edge compute, Internet of Things, satellite connectivity, private networks, public services and autonomous transportation…Delivering materially improved financials. Clearing a fiber transaction, running a tighter organization, and paying down debt has material financial benefits for all shareholders. That includes our projections to: Take AFFO after discretionary CapEx to over $5 per share by 2025, up from its current $3 per share. Take AFFO after Discretionary Capex and Dividend from a $1.3 billion DEFICIT to a positive $200 million. Drive EBITDA Margin per tower from 70% toward 75-80% in line with Crown Castle’s peers AMT and SBA. The current dividend is funded with debt and, in my view, is unsustainable. Our plan is to payout 90%, translating to a dividend of $4.62/share in 2025 with annual growth of 6-7%…Reduce total debt to approximately $17B…Pay off all floating rate debt eliminating interest rate exposure for the company…I have never been more excited about an investment opportunity for all stakeholders. It’s why I’ve got real skin in the game — $100M of capital from myself and select investors – to aid this transformation…the Cooperation Agreement enshrines Elliott as the de facto controller of the Company, with direct influence at the board level and across the committees that control Crown Castle’s strategic future. Our fear is that this bargain with Elliott deprived shareholders of what was best for the Company…The company has offered stockholders no explanation for the Board’s decision to give Elliott such dominance..There is a straightforward solution to all this: Promptly submit the Cooperation Agreement to a stockholder vote…. To improve the prospects for all Crown Castle shareholders, I have nominated four directors to the board. Myself; Chuck Green…; Tripp Rice…; and David Wheeler…”