Deutsche Telekom inked a deal with Australia-based IFM Investors to form a fiber joint venture (JV) in Germany, with the investment company set to pump €900 million (approximately $1 billion) into the undertaking.
Under the terms of the agreement, IFM’s investment will secure it a 50% stake in a new fiber company called GlasfaserPlus GmbH. The JV is targeting deployment of gigabit-capable fiber to more than four million homes in rural parts of Germany by 2028. Rollouts are expected to begin in 2022 following the deal’s close.
IFM Investors’ Executive Director Deepu Chintamaneni said in a statement the deal marks the company’s “first major fiber investment in Europe.”
Kyle Mangini, IFM Investors’ global head of Infrastructure, added the JV is “an attractive investment for IFM’s Global Infrastructure Fund,” offering “strong socio-economic benefits as well as long-term cash-flow predictability, which will help us deliver on our purpose, which is to protect and grow the long-term retirement savings of working people.”
IFM stated in a press release GlasfaserPlus will adopt an open access network model, making its infrastructure available to both Deutsche Telekom and its competitors on a non-discriminatory basis. DT plans to sign a wholesale agreement with GlasfaserPlus when the JV transaction closes.
Srini Gopalan, DT board member and managing director of Telekom Deutschland, stated that inclusive of its investments in GlasfaserPlus, the operator plans to spend more than €30 billion on fiber by 2030.
Confirmation of the JV’s formation follows reports last month that DT was pursuing such a deal.
Several other operators, including Liberty Global and Telefonica, have also announced plans to build fiber in Germany. In a September report, the FTTH Council Europe predicted the number of FTTH passings in Germany will rise from 9 million in 2021 to 33 million in 2026.