It's Official: KPN and Reggefiber Planning Joint Venture

| About: Royal KPN (KKPNY)

The word is out, but no big surprise for our readers: KPN (KPN) and privately held Reggefiber will build out FTTH nationwide in the Netherlands, spending EUR 6-7bn over five-seven years. Vincent Dekker gets the credits for digging in. KPN and Reggefiber are planning a joint venture Glashart (originally Reggefiber FttH), with KPN taking a 41% stake + option to a majority.

Just a few comments/clarifications:

1. Conditions:

  • NMa (competition authority) approval: without it, there's obviously no deal. Also, the combo would risk to be regulated at the retail level. That's a no-go too. Approval seems to be close.
  • OPTA (the NRA) regulation: due Monday, open for a brief two week consultation. KPN and Reggefiber will realise they have to play nice, or else risk to be structurally separated.

2. Numbers:

  • Capex: 1000 EUR/home seems reasonable for 'just' the passive network. No more DSLAMs, no VDSL2 - that saves a lot too.
  • Timeframe: current run rate is 200k homes/annum, with room to move to 600k. That would still require 12 years for the entire 7.2m homes. I suppose they will target 75% or so, and see about the rest later (wireless?).

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Tagged: , Telecom Services - Domestic, Netherlands
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