Investment firms EQT Infrastructures and OMERS bought fiber-to-the-home company (FTTH) Deutsche Glasfaser from another investment company. According to Reuters, EQT and OMERS paid KKR about $2.74 billion plus debt for Deutsche Glasfaser.
The deal, which is expected to close in the second half of this year, gives EQT a 51% stake in Deutsche Glasfaser, while OMERS has the remaining 49%. The two companies said that over the coming years they would invest more than $7 billion to roll out high-speed internet infrastructure in Germany.
The German government has put a plan in place to provide nation-wide gigabit internet infrastructure across the country by 2025. In order to meet that goal, companies such as Deutsche Telekom and Vodafone have ramped up their fiber deployments efforts in rural, underserved areas of the country.
Last month, Deutsche Telekom and Deutsche Glasfaser announced they would jointly use Glasfaser's fiber-optic network, starting with a pilot project in the city of Lüdinghausen.
Deutsche Glasfaser, which was founded in 2011 by investor Reggeborgh, provides internet access to more than 600,000 homes and 5,000 businesses through its 30,000 kilometers of fiber.
Last year EQT Infrastructure bought Inexio, and now plans to merge that company with Deutsche Glasfaser.
"EQT has a long history of developing strong fiber companies and looks forward to leveraging this experience, and together with OMERS, contribute to the German government’s plan to deliver nationwide gigabit Internet access by 2025, said Matthias Fackler, partner at EQT Partners, in a statement. "Deutsche Glasfaser and Inexio combined will play a vital role in enabling digital inclusion and sustainable economic growth.”
Last month Deutsche Telekom announced it had formed a joint venture with utility company EWE to build out a fiber infrastructure that will serve up to 1.5 million homes and businesses. The new fiber-joint venture is called Glasfaser Nordwest, and it will be headquartered in Oldenberg, Germany. The joint venture's goal is to bring fiber-to-the-home (FTTH) infrastructure to Lower Saxony, starting with 12 municipalities.