Vodafone creates new German JV with Altice

dl vodafone mobile shop sign cellphone 5g — VodafoneSharecast photo / Josh White

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Telecommunications giant Vodafone has created a new joint venture with French firm Altice to deploy fibre-to-the-home services to up to 7.0m German homes over a six-year period.

Vodafone said on Monday that FibreCo, its 50/50 partnership with Altice, will offer wholesale access to telecommunications service providers in Germany. The creation of FibreCo is expected to be completed in the first half of 2023.

As part of the deal, Vodafone will receive up to €1.2bn from Altice, including an upfront payment of €120.0m, with the remainder being made up of deferred and earn-out payments based on FibreCo's performance.

Over the roll-out period, FibreCo intends to invest as much as €7.0bn, of which 70% will be financed by debt that will be non-recourse to Vodafone and Altice. Vodafone's share of equity contributions was projected to be lower than cash proceeds realised over time.

Chief executive Nick Read said: "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.

"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.

Reporting by Iain Gilbert at Sharecast.com