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Telenor collects €1bn as it sells fibre stake to KKR consortium

Tone Hegland Bachke Telenor.jpg

Telenor has sold a 30% stake in its fibre company to a consortium that includes US-based investor KKR.

The newly established company, Telenor Fiber, is a subsidiary of Telenor and will be a part of the infrastructure business area. The company will own the passive fibre assets in Norway. This includes 130,000km of cables, connecting upwards of 560,000 homes.

Teelnor CFO Tone Hegland Bachke (pictured) said: “This transaction highlights the value in our infrastructure and unlocks capital to support continued high fibre roll-out in Norway, and we are bringing in strong investors with a long-term horizon.”

The KKR consortium will pay 10.8 billion Norwegian kroner (€1.03 billion) for the stake, valuing the fibre company at €3.44 billion. The business generated a proforma EBITDA of €162 million in 2021, said Telenor. The consortium includes life insurance company and pension fund Oslo Pensjonsforsikring as a co-investor.

The new company’s assets will be transferred from Telenor Norway in a demerger process prior to completion of the transaction. Telenor Norway will be the company’s only customer and all operational processes remain under full Telenor control.

Julian Barratt-Due, director of European infrastructure at KKR, said: “We are very excited to be investing long-term capital behind Norwegian infrastructure. KKR has significant experience within telecom infrastructure investing, and we look forward to supporting Telenor with its fibre strategy in Norway.”

In a plan announced in May, Italy’s TIM will merge its fixed network with Open Fiber and this deal was supported by KKR, which has shares in TIM’s FiberCop fixed-line business and Macquarie Asset Management, which holds a stake in Open Fiber.

In August KKR bought cloud security company Barracuda for $3.8 billion.