Vodafone and Altice ink €7 bn FTTH venture in Germany

Vodafone Group and Altice announce their 50-50 joint venture to deploy fibre-to-the-home (FTTH) to up to 7 million homes in Germany with an investment of $6.8 billion over a 6-year period.
Orange FTTH businessVodafone’s broadband network in Germany currently offers up to 1Gbps connections to over 24 million homes. Vodafone aims to offer fibre connections closer to all connected homes through ‘node splitting’ and DOCSIS 3.1 ‘high split’, for offering speeds of over 3Gbps.

The joint venture will construct and operate a FTTH broadband network available to up to 7 million homes. Approximately 80 percent of the roll-out will be focused around large housing associations in Vodafone’s existing hybrid fibre cable network footprint.

The remaining 20 percent of the Roll-out will be outside of Vodafone’s current footprint, focusing on neighbouring homes.

Vodafone-Altice’s $6.8 billion investment in fibre broadband network business in Germany in 6-years would challenge the business of Deutsche Telekom. Germany is the biggest market for Vodafone.

The JV will offer wholesale access to all telecommunications service providers, to fully exploit the potential of the infrastructure.

The JV has contracted Geodesia, a subsidiary of Altice, for the majority of roll-out construction and maintenance.

FibreCo will offer wholesale access to all telecommunications service providers in Germany, exploiting the full potential of the fibre network. Vodafone Germany will act as the anchor tenant, entering into an agreement with the FibreCo upon closing of the deal.

Vodafone is expected to receive cash proceeds from Altice of up to €1.2 billion as part of the transaction.

FibreCo intends to invest up to €7 billion, of which 70 percent is expected to be financed by debt that will be non-recourse to Vodafone and Altice.

The transaction is subject to customary closing conditions, including regulatory approval and is expected to close in H1 2023. The creation of FibreCo is expected to be completed in H1 2023.