Altice France has entered into an exclusivity agreement with a group of investors to sell a 49.99 percent stake in SFR FTTH, a new fibre venture that will bring fibre connectivity to 5 million French premises. Allianz Capital Partners (ACP), AXA Investment Managers and Canadian investment firm Omers Infrastructure will acquire the stake for a total cash consideration of EUR 1.8 billion, based on a EUR 3.6 billion equity value. SFR FTTH will sell access to its network as a wholesaler, pledging to offer the same terms to all operators, including Altice France's SFR business, with no minimum volume commitments.
Altice founder Patrick Drahi said that the transaction, expected to close in H1 2019, will enable Altice France and Altice Europe to further reduce their net leverage ratios, while gaining access to new and cheaper lines of credit. The future capital expenditure associated with the SFR FTTH roll-out is covered by a EUR 1.8 billion non-recourse debt package to be deployed over the next four years, said the company.
The new venture targets a footprint of 5 million homes, with more to be franchised or acquired. At least 1 million homes will be covered per year over a four-year period. Altice France will sell technical services to SFR FTTH for the construction, the subscriber connection and the maintenance of its FTTH network.
News of the deal first emerged in August, following press revelations that Altice had hired Lazard to advise on the transaction. The company was actively looking for partners to meet SFR’s deployment targets, particularly in the less densely populated areas covered by the so-called AMII agreement, renegotiated with French regulator Arcep in June.
