A recap of KKR’s 2021 telecoms deals

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Earlier this week, US hedge fund Kohlberg Kravis Roberts (KKR) launched a €10.8 billion ($12 billion) takeover bid for Telecom Italia (TIM) in an attempt to take the company private.

The deal was met with vehement opposition from TIM’s largest stakeholder Vivendi and while a solution isn’t likely to come soon, KKR has been busy with several telecoms deals throughout the course of the year. 

The firm manages multiple alternative assets in the energy, infrastructure and real estate but has made a splash in telecoms in recent times. 

In February the company announced that it had entered into an agreement with Telefónica to establish Chile’s first open-access wholesale fibre optics company valued at $1 billion.

Under the terms of the agreement, KKR will acquire a majority stake in Telefónica Chile’s existing fibre optic network and then turn it into an open-access network through a newly created, locally managed Chilean company.

In April, the company acquired 37.5% of FiberCop from TIM, which was the largest shareholder of the company, for an equivalent value of €1.8 billion. 

However, even after that deal, TIM remained debt-ridden, owing almost €30 billion altogether. 

KKR was busy in April as it was also the month that it announced a collaboration with DTCP to unveil an independent wholesale fibre venture – Open Dutch Fiber, which aims to deploy FTTH to a minimum of one million homes by 2025. 

T-Mobile Netherlands was confirmed as the anchor tenant for the deal and has signed up to a 20-year agreement. The deal will also see a fully-funded commitment for an envisaged capital expenditure of around €700 million as part of the deal.

In July KKR entered an agreement with Telefónica Colombia to establish the country's first independent open-access wholesale digital infrastructure company.

Valued at roughly $500 million, KKR will acquire a 60% stake in Telefónica’s existing fibre optic network, with Telefónica retaining the remaining 40%. After which KKR convert the network into open access through a newly established independent entity

Just earlier this month KKR and Global Infrastructure Partners (GIP) announced they had entered a definitive agreement to acquire all outstanding shares of common stock of CyrusOne for approximately $15 billion.

KKR said it will finance that deal from its global infrastructure and real estate equity strategies, while GIP’s investment is being made from its global infrastructure funds.

And there are reports that KKR is also looking to expand in the data centre space. They are one of a few companies weighing up a bid for data centre company Global Switch. 

While it isn’t yet certain whether a bid will be made, the company has registered its interest alongside Equinix, Blackstone and DigitalBridge. 

Chinese steel giant Jiangsu Shagang Group controls the company and values the company at around $10.7 billion.