TIDMVOD
RNS Number : 0188D
Vodafone Group Plc
17 October 2022
17 October 2022
VODAFONE AND ALTICE TO CREATE A JOINT VENTURE TO DEPLOY
FIBRE-TO-THE-HOME IN GERMANY, CONNECTING UP TO 7 MILLION HOMES
Vodafone Group Plc ("Vodafone") and Altice ("Altice") today
announce they are creating a joint venture ("FibreCo") to deploy
fibre-to-the-home ("FTTH") to up to 7 million homes over a 6-year
period.
Vodafone operates a leading next generation broadband network in
Germany, currently offering up to 1Gbps connections to over 24
million homes. This partnership with Altice is complementary to
Vodafone's clear upgrade plans for its existing hybrid fibre cable
network. This includes bringing fibre connections closer to all
connected homes through 'node splitting' and DOCSIS 3.1 'high
split', which enables download speeds of over 3Gbps. These upgrade
plans, coupled with next generation technology advances, such as
DOCSIS 4.0, provide a path to 10Gbps speeds across our hybrid fibre
cable network over time.
Key elements of FibreCo and its investment plans include:
-- FibreCo will be owned 50% by Vodafone Germany and 50% by Altice
-- FibreCo will construct and operate a FTTH broadband network
available to up to 7 million homes (the "Roll-out")
- approximately 80% of the Roll-out will be focused around large
housing associations in Vodafone's existing hybrid fibre cable
network footprint which are interested in FTTH upgrades; and
- the remaining 20% of the Roll-out will be outside of
Vodafone's current footprint, focusing on neighbouring homes
-- FibreCo will offer wholesale access to all telecommunications
service providers, to fully exploit the potential of the
infrastructure
-- FibreCo will benefit from Vodafone's commercial expertise and
relationships with housing associations and Altice's unique FTTH
roll-out, wholesale and operational expertise
-- FibreCo has contracted Geodesia (a subsidiary of Altice) for
the majority of Roll-out construction and maintenance
-- The creation of FibreCo is expected to be completed in H1 2023
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
Transaction. Within FibreCo's footprint, Vodafone Germany has
committed to market FibreCo's network to new customers on an
exclusive basis, whilst Vodafone Germany's existing network will
continue to service customers who do not wish to migrate to FTTH.
Vodafone Germany is not providing FibreCo with any minimum revenue
or volume commitment.
Nick Read, Vodafone Group Chief Executive, commented: "This
partnership builds on Vodafone's significant next generation
network with Altice's industrial expertise and proven
Fibre-to-the-Home construction capabilities enabling us to bring
gigabit connectivity to even more customers in Germany. We are
proud of our long-standing relationships with housing associations
and pleased as a trusted provider to bring more connectivity
options for tenants. This significant infrastructure investment
supports the country's social, economic and digital development and
the broadband ambitions of the German government as part of
Europe's Digital Decade targets."
David Drahi, co-CEO of Altice, commented: "We are delighted and
honoured to join forces with Vodafone to build and operate a FTTH
network connecting up to 7 million premises in Germany. Altice's
existing presence in Germany through Geodesia, its unique track
record in operating over 45 million homes with the latest very-high
speed fibre networks across Europe and the US, together with
Vodafone's competitive position as anchor tenant will help us
establish one of the largest FTTH ventures in Europe. We have
pioneered fibre joint ventures in France and Portugal, and are thus
thrilled to be able to replicate such a feat in Germany with such a
partner."
Financial information
As part of the Transaction, Vodafone is expected to receive cash
proceeds from Altice of up to EUR1.2 billion, comprising:
-- An upfront payment of EUR120 million at closing;
-- Additional deferred payments of up to EUR487 million (in
aggregate) to be paid as the Roll-out progresses (once the first
1.5 million homes have been passed and until the end of the
Roll-out), and
-- An earn-out of up to EUR595 million (in aggregate) based on FibreCo's performance.
Over the Roll-out period, FibreCo intends to invest up to c.EUR7
billion, of which 70% is expected to be financed by debt that will
be non-recourse to Vodafone and Altice. Vodafone's share of equity
contributions is expected to be lower than the cash proceeds
realised over time.
The transaction is subject to customary closing conditions,
including regulatory approval and is expected to close in H1
2023.
- ends -
For more information, please contact:
Investor Relations Media Relations
Investors.vodafone.com Vodafone.com/media/contact
ir@vodafone.co.uk GroupMedia@vodafone.com
Registered Office: Vodafone House, The Connection, Newbury,
Berkshire RG14 2FN, England. Registered in England No. 1833679
Altice Investor Relations Altice Media Relations
sam.wood@altice.net arthur.dreyfuss@altice.net
About Altice
Altice is a global leader in telecom, content, media,
entertainment, and advertising. Its core identity lies in the
more-than-46 fixed million homes passed it has deployed and
currently operates with state-of-the-art fibre technology. Altice
delivers innovative, customer-centric products, and solutions that
connect and unlock the limitless potential of its over-50-million
customers over fibre and mobile broadband networks. On top of
operating in France, Portugal, Israel, the Dominican Republic, the
United States, and Germany, Altice has also successfully
established first-of-its-kind and fibre infrastructure joint
ventures in France, Portugal, and Israel, comprising 18 million
homes passed. Altice also has a global presence through its online
advertising business Teads.
About Geodesia
Geodesia is an engineering and construction company whose core
mission is to deliver the finest very high-speed telecom networks.
Over the past 20 years, its operations have spanned across France,
Portugal, Israel, the Caribbean, United States, and Germany, with a
perpetual goal of bettering Geodesia's expertise and know-how in
the end-to-end build-up of Telecom Networks. Geodesia's solutions
comprise the full range of Telecom Networks' activities for both
fixed and mobile technologies (engineering, civil engineering,
installation and commissioning, maintenance, etc.) whilst also
proposing a bespoke line of dedicated products (ODN passive
networks, XGS-PON active solutions, small cells, OSS, etc.).
Geodesia is committed to enhance people's quality of life-paying
attention to security and the environment-thereby striving for a
better tomorrow. https://www.geodesia.net/ .
About Vodafone
Unique in its scale as the largest pan-European and African
technology communications company, Vodafone transforms the way we
live and work through its innovation, technology, connectivity,
platforms, products and services.
Vodafone operates mobile and fixed networks in 22 countries, and
partners with mobile networks in 47 more. As of 30 June 2022, we
had over 300 million mobile customers, more than 28 million fixed
broadband customers and 22 million TV customers. Vodafone is a
world leader in the Internet of Things (IoT), connecting around 160
million devices and platforms.
We have revolutionised fintech in Africa through M-Pesa, which
celebrates its 15(th) anniversary in 2022. It is the region's
largest fintech platform, providing access to financial services
for more than 50 million people in a secure, affordable and
convenient way.
Our purpose is to connect for a better future by using
technology to improve lives, digitalise critical sectors and enable
inclusive and sustainable digital societies.
We are committed to reducing our environmental impact to reach
net zero emissions across our full value chain by 2040, while
helping our customers reduce their own carbon emissions by 350
million tonnes by 2030. We are driving action to reduce device
waste and achieve our target to reuse, resell or recycle 100% of
our network waste.
We believe in the power of connectivity and digital services to
improve society and economies, partnering with governments to
digitalise healthcare, education and agriculture and create
cleaner, safer cities. Our products and services support the
digitalisation of businesses, particularly small and medium
enterprises (SMEs).
Our inclusion for all strategy seeks to ensure no-one is left
behind through access to connectivity, digital skills and creating
relevant products and services such as access to education,
healthcare and finance. We are also committed to developing a
diverse and inclusive workforce that reflects the customers and
societies we serve.
For more information, please visit http://www.vodafone.com ,
follow us on Twitter at @VodafoneGroup or connect with us on
LinkedIn at http://www.linkedin.com/company/vodafone .
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