Entel Chile has announced the sale of its fibre network to a Telefonica/KKR joint venture, bringing in the best part of US$360 million.
There’s nothing unusual about a telecoms operator in any part of the world offloading infrastructure assets, particularly in the current climate; it’s a tried and tested method of raising money. But it’s a little unusual for one telco to offload these types of assets to another, especially when the buyer is a market competitor.
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OnNet Fibra, which is 60% owned by KKR, the remainder being in the hands of Telefonica, has agreed to pay US$358 million for Entel’s fibre-to-the-home (FTTH) network, which currently passes 1.2 million homes and businesses. When merged with OnNet Fibra’s assets, the infrastructure will cover 3.9 million premises, and the firms have pledged to increase coverage to 4.3 million by 2024, a commitment that may well be designed to help them get the green light from regulators.
Telefonica spun off its Chilean fibre network business and sold a majority stake to KKR in early 2021 – the deal closed mid-year – in a transaction that valued it at $1 billion. At the time the business, then known as InfraCo, covered 2 million homes, but Telefonica insisted it would extend the network to 3.5 million, more than half of the households in the country, by 2022.
