IHS takes controlling stake in FiberCo for US$299 million
Brazil's IHS has bought a 51% stake in TIM SA's fibre optics unit FiberCo, in a deal worth US$299 million, according to a securities filing on Wednesday.
Subject to regulatory approval, the deal will see around one billion of the 1.6 billion reais value paid to TIM, owned by Telecom Italia, and 609 million reais paid to FiberCo, according to TIM's exchange filing.
Sam Darwish, IHS Towers' chairman and group CEO, said: "I am delighted to announce this transaction with TIM as it marks a significant milestone in our Latin American growth trajectory and our ongoing relationship with TIM. In our African markets, we are already delivering fibre connectivity solutions and I am excited to transfer our knowledge to the Brazilian market and partner with one of the region’s leading mobile networks. By combining IHS’ engineering excellence with TIM’s exceptional market knowledge we will be well-placed to deliver fiber connectivity as demand in the region soars."
The deal values FiberCo at 2.6 billion reais and, upon completion, FiberCo’s asset base will include TIM’s secondary network infrastructure, covering approximately 6.4 million households, of which 3.5 million are FTTH and 3.5 million FTTC.
FiberCo will be responsible for the deployment of new fibre infrastructure for TIM, and the operation and maintenance of all such fiber infrastructure. TIM will be an anchor tenant across the network under a long-term master services agreement.
The two entered talks in March around a fibre partnership, which TIM said would help to expand the nation's fiber network.
Pietro Labriola, TIM Brasil CEO, added: "This is a fundamental step in our fiber growth strategy. It will enable TIM to meet the growing demand for fiber services and place FiberCo in a unique position within the Brazilian market. Our selection of IHS as our partner, a company with exceptional operational expertise, provides us with the capabilities to deliver large-scale services with robust fiber and cutting-edge solutions. This joint venture is testament to our commitment to the Brazilian market as we strive to stay ahead of its rapidly growing fiber demands."
The deal was confirmed in a securities filing on Wednesday and follows earlier IHS deals, including its acquisition of Skysites and Centennial Towers’ Brazil.