European carrier Orange has announced an agreement to sell a portion of its fixed fiber assets in France to a group of three investors for about US$1.58 billion, according to Mobile Europe. The sale involves a divestiture of 50 percent equity interest and co-control of Orange Concessions. Analysts say the move is consistent with other European carriers to reduce debt and meet increased demands caused by the pandemic, by selling assets such as fiber and tower portfolios.
The carrier said Orange Concessions will become France’s leading fiber-to-the-home (FTTH) operator of networks rolled out and operated on behalf of local public authorities. The partnership is designed to enable Orange Concessions to seize growth opportunities while allowing Orange to support its ambitions in public initiative networks (PINS) while sharing required investment. Fiber roll-out and maintenance will continue to be performed by Orange which will hold a call option that will enable it to take control and consolidate Orange Concessions in the future.
The transaction is expected to close by the end of 2021.
“I am delighted that Orange, Europe’s leader in fibre roll-out, is now set to establish this partnership in its domestic market with recognized investors who share our vision of digital communication infrastructure development,” said Stéphane Richard, Chairman & CEO of Orange. “Through this partnership, Orange holds the means to pursue the development of fibre in rural areas, by winning new public initiative networks or by participating in market consolidation. This is a key milestone in the delivery of our Engage 2025 strategic plan,” he said.