Vodafone-Altice JV to spend €7bn on FTTH upgrade after merger
French company Altice now owns 50% of Vodafone’s fibre-to-the-home (FTTH) company in Germany.
The deal, completed this morning, was announced last October, and the new joint venture will spend €7 billion over the next six years deploying FTTH to to up to 7 million homes in Germany.
Vodafone said the plan “will be partly financed by debt that will be non-recourse to Vodafone and Altice. Total debt facilities of up to €4.6 billion have been arranged with a group of leading financial institutions to support the network deployment.”
Altice is expected to pay up to €1.2 billion to Vodafone, starting off with €120 million now the rest as the network is built out and in payments that will depend on financial performance.
The European Commission approved the creation of the JV last month.
The unit was originally Kabel Deutschland, a cable TV company that Vodafone bought for €7.7 billion in 2013 after a bidding war with US cable operator Liberty Global.
As part of th at offer, Vodafone took on €3 billion in net debt, increasing the enterprise value of the 2013 deal to €10.7 billion.
The old Kabel Deutschland infrastructure, mainly connecting apartments in blocks, operated to obsolete hybrid fibre cable (HFC) standards , while Vodafone was building new fibre networks operating at up to 1Gbps.