Telenor is establishing a subsidiary that will own the passive fibre assets in Norway. This includes 130,000 km of cables, connecting upwards of 560,000 homes. The company’s assets will be transferred from Telenor Norway in a demerger process prior to completion of the transaction.
Under the plan, Telenor will divest a 30% share in the new company to a consortium led by KKR, investing through its Core Infrastructure strategy. The consortium includes Oslo Pensjonsforsikring as a co-investor. The sales price is approximately NOK 10.8 billion.
Telenor Norge will be the only customer of the new Telenor Fiber AS. All operational processes remain under full Telenor control. The business generated a proforma EBITDA of NOK 1.7 billion in 2021.
Telenor said it has conducted an extensive consultation process with the relevant government authorities, who have given their overall feedback that the transaction safeguards critical security and regulatory considerations.
“We are executing on the strategy presented at the Capital Markets Day in September. This transaction highlights the value in our infrastructure and unlocks capital to support continued high fibre roll-out in Norway, and we are bringing in strong investors with a long-term horizon. Following the transaction, Telenor will propose that parts of the proceeds are used for share buy backs. We believe this transaction benefits our stakeholders while safeguarding future investments in Norway’s fibre”, says Tone Hegland Bachke, EVP and CFO in Telenor Group.
“We are very excited to be investing long-term capital behind Norwegian infrastructure. KKR has significant experience within telecom infrastructure investing, and we look forward to supporting Telenor with its fibre strategy in Norway”, says Julian Barratt-Due, Director, European Infrastructure at KKR.
Telenor intends to use parts of the proceeds for share buybacks to mitigate the effects of the new minority interests.
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