IFM Investors, through the IFM Global Infrastructure Fund (IFM GIF), has agreed on a long-term partnership with Deutsche Telekom (ETR: DTE), establishing a new joint venture (JV), which plans to roll out gigabit-capable Fibre-to-the-Home (FTTH) broadband to over four million homes in rural areas of Germany by 2028.
Under the agreement, IFM GIF, which is owned by a group of Australian pension funds, will acquire a 50% stake in the fibre roll-out company GlasfaserPlus GmbH for €0.9 billion (US$1.04 billion).
GlasfaserPlus will be headquartered in the Cologne area and is expected to build FTTH connections to more than four million homes across Germany from 2022 to 2028.
The brand will operate its fibre network under an “open access” model and make its network open to Deutsche Telekom as well as its competitors on a non-discriminatory basis. Deutsche Telekom will sign a wholesale agreement with GlasfaserPlus at closing.
Subject to relevant regulatory approvals, the joint venture will roll out fibre-optic networks from 2022 and also participate in government subsidy tenders.
Kyle Mangini, global head of infrastructure at IFM Investors, said: “This is an attractive investment for IFM’s Global Infrastructure Fund – the GlasfaserPlus joint venture has 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.”
Also commenting, Srini Gopalan, member of the Deutsche Telekom Board of Management responsible for Deutsche Telekom’s business in Germany, added: “Partnerships are indispensable for the successful digitisation of our country. We are therefore very pleased that we were able to attract IFM GIF for our joint venture. This is a clear commitment to Germany as a business location and a signal that we will work together to build the digital backbone of our future society.
“Including the investments of the GlasfaserPlus joint venture, by 2030 we plan to invest more than €30 billion in fibre alone, so that all households and businesses will benefit from a gigabit-capable fibre connection. GlasfaserPlus helps us to decisively accelerate the digitisation of rural areas.”
The $2 billion fibre investment in Germany follows on from France’s $3 billion rural fibre commitment announced this Monday.