Elliott succeeds in pushing Brown out of Crown Castle

Crown Castle CEO Jay Brown has informed the company's board "of his decision to retire," according to Crown Castle.

The announcement comes just days after Elliott Investment Management, an activist investor firm, again took aim at Crown Castle and its leadership.

"The underperformance of CEO Jay Brown and his fiber strategy is unambiguous: When we launched our 2020 campaign, Crown Castle had underperformed its direct peers by an average of 70% during the tenure of this leadership team," Elliott wrote in another letter Thursday, just hours before Brown announced his departure. "That underperformance has now expanded to 85%, translating into $26 billion of unfulfilled value."

Brown's departure would appear to pave the way for Crown Castle to acquiesce to Elliott's demands and consider a sale of its fiber business, and likely also its small cell operations.

Crown Castle named Anthony Melone, a member of the company's board and Verizon's former CTO, as its interim CEO while the board starts a search for a permanent CEO.

Stock boost

Brown's departure comes as somewhat of a surprise. Earlier this week, the financial analysts at KeyBanc Capital Markets wrote in a note to investors: "We doubt change is coming."

But the financial analysts at Wells Fargo wrote that a change at Crown Castle – one that drives the company to sell its fiber business – could result in a 5% to 10% increase to the company's stock.

Due to that analysis, the firm raised its rating on Crown Castle's stock to "Equal Weight," from "Underweight."

Crown Castle's shares were up 1.55% in after-hours trading Thursday to around $119 per share.

"It has been a privilege to lead this outstanding company and be a part of its growth and success for over two decades," Brown said in a release. "I'm confident the company's future is bright as its world-class team continues the critical work to connect people, communities and businesses with each other and to the data, technology and wireless services they rely on every day."