German broadband provider valued at 7 billion euros is launched by Vodafone and Altice
A 7 billion euro German broadband firm is launched by Vodafone and Altice.
London: Vodafone and Altice launched a joint venture on Monday to challenge Deutsche Telecom by building a €7 billion ($6.8 billion) fiber broadband network in Germany.
Vodafone said the FibreCo project would build a broadband “fiber to the home” network available to seven million German households, allowing Britain’s Vodafone to modernize its existing network in Germany, its biggest market.
FibreCo will invest up to €7bn in the six-year project, which is expected to be 70% debt financed.
Altice’s subsidiary, Geodesic, will have a contract with Vodafone Germany, responsible for marketing faster broadband to new customers.
Both companies will own 50% of FibreCo.
The participation process is subject to regulatory approval and is expected to be completed in the first half of 2023.
“This partnership builds on Vodafone’s strong next-generation network with Altice’s industry expertise and proven fiber-to-the-home build capabilities,” said Nick Read, Vodafone CEO.
Vodafone said it would receive cash returns from Altice of up to €1.2bn, which could exceed its capital contributions to the joint venture over time.
Reed, under pressure from long-suffering investors to improve the returns of pan-European mobile and broadband company Vodafone, is in talks with CK Hutchison 0001.HK about integrating his business in Britain.
Altice is an Amsterdam-based holding company that brings together the assets of Franco-Israeli cable tycoon Patrick Drahi. It already operates fiber infrastructure joint ventures in France, Portugal, and Israel.
Vodafone shares were trading 0.5 percent higher at 100 pence in early trading on Monday.
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