Orange Sells Half of $3 Billion Fiber Unit to Fund Rural Rollout
Orange Sells 50% of Fiber Unit, Giving It $3.3 Billion Valuation
(Bloomberg) -- French telecommunications giant Orange SA is carving out and selling half its interest in a fiber-optics operator valued at 2.7 billion euros ($3.3 billion), the latest in a series of deals by carriers to share the cost of deploying the technology to rural regions.
Caisse des Dépôts, CNP Assurances and EDF Invest will acquire a 50% holding in the fiber-optic unit Orange Concessions, according to a statement. Orange will hold a call option that will allow it to regain control and consolidate the unit in the future.
The transaction, expected to close by the end of the year, is aimed at easing the cost of rolling out fiber-optic connections to less-populated regions and extracting value from its infrastructure, Orange said. The partnership will be France’s leading fiber-to-the-home operator with more than 4.5 million planned or built plug-ins.
Orange Chief Executive Officer Stephane Richard said the accord will allow Orange to win new contracts for networks from local authorities and participate in market consolidation.
The move is the most recent example of fiber deals between French operators and yield-hungry pension funds and infrastructure investors that have been sparked by the government’s push to roll out ultra-fast Internet access to a wider swathe of the population.
In November, 2019 Altice Europe NV’s mobile infrastructure unit SFR FTTH and a consortium of investors including OMERS, Allianz Capital Partners and AXA Investment Partners paid 1 billion euros for fiber-network operator Covage. Altice is putting some assets on the block following the takeover, Bloomberg News reported this month.
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