Sprint hands keys for cellular towers to third-party

Operation and maintenance of Sprint's cellular network towers will be taken over by TowerCo, freeing up capital for the cash-strapped company.

TowerCo paid $670 million for about 3,300 CDMA and IDEN towers. In exchange, the company has signed a long-term lease with Sprint for their use. The deal is expected to close within 90 days.

Monies realized from the sale are likely to be applied to pay down Sprint's $24 billion debt, the company said. Sources also indicate a sale of the Nextel division is also being considered.

While at first the deal may seem somewhat strange, it makes sense for Sprint due to the carrier's current situation. By outsourcing the upkeep of its network to another party, Sprint expects to save money in the long run and better focus on its customers.

It's also not all that uncommon. There are other companies doing the same thing as TowerCo -- such as American Tower and Crown Castle International -- and other carriers have already sold off some of their towers, including AT&T and Verizon Wireless.

"Significantly, this transaction provides Sprint Nextel with additional liquidity which gives us greater flexibility in managing our company," Sprint's head of field engineering and operations Bob Azzi said in a statement.

Most of the Sprint-owned towers are located in large metropolitan markets, which makes them very valuable to the owner. Its not immediately clear if TowerCo works with any of Sprint's competitors, such as Verizon.