Elliott Investment Management Puts Pressure on Crown Castle

Elliott Investment Management, one of the oldest and largest activist investors, has recently acquired an approximately $2 billion stake in Crown Castle (ticker: CCI), a leading cell-tower company in the United States. In a letter released by Elliott on Monday, the investment firm stated its intentions to seek new executive and board leadership, as well as other changes within the company.

Crown Castle, a real estate investment trust, operates communication infrastructure across the country and mainly generates revenue from its partnerships with AT&T (T), T-Mobile US (TMUS), and Verizon Communications (VZ). With 85,000 miles of fiber cables, Crown Castle plays a crucial role in connecting customers to high-speed internet.

This is not the first time Elliott has shown interest in Crown Castle. When it first invested in the company several years ago, Elliott proposed an overhaul of Crown Castle's fiber-cable business, emphasizing the need for a minimum return of 40% on investment in this asset.

As of now, with assets totaling $59.2 billion, Elliott is urging Crown Castle to re-evaluate its fiber strategy and consider options such as selling the business. The investment firm also criticizes Crown Castle for disregarding its previous recommendations without taking them seriously.

Although Crown Castle has not responded to requests for comment at this time, last year the company did make some changes in response to Elliott's suggestions. These changes included a board overhaul and the implementation of a policy preventing nonemployees above the age of 72 from being nominated to the board of directors.

In addition to leadership changes, Elliott is calling for an improved incentive plan for management and better corporate governance within Crown Castle.

Despite the external pressures, Crown Castle's stock experienced a 4.2% increase in early trading on Monday. However, the stock has endured a 20% decline so far this year.