KKR, a global investment firm, and Deutsche Telekom Capital Partners (DTCP), an investment management platform, have announced that they have entered into an agreement with T-Mobile Netherlands to launch a joint venture known as Open Dutch Fiber.
Open Dutch Fiber to provide new fiber services in the Netherlands
Open Dutch Fiber, which is majority-owned by KKR and with DTCP as a minority shareholder, will provide fiber-to-the-home (FTTH) broadband in the Netherlands. It will be delivering high-quality fiber connections to Dutch residents and businesses in predominantly urban areas. The platform has an open architecture and will make wholesale fiber services available to all operators.
Vicente Vento, co-founder & CEO of DTCP, says, “The creation of Open Dutch Fiber is an important milestone in the acceleration of fiber rollout in the Netherlands and a blueprint for innovative financing solutions in European digital infrastructure. We are firm believers in the sharing of digital infrastructure and are establishing Open Dutch Fiber as an open access model, enabling attractive economics for operators and best prices for consumers.”
The operations will begin in Q2 2021 with a fully funded capital expenditure commitment of about €700M. The construction agreements are already in place.
To support the rollout, Open Dutch Fiber has signed an agreement with T-Mobile Netherlands, a mobile operator and FMC challenger in the Netherlands. T-Mobile Netherlands has a mobile base of 6.8 million customers and a fixed base of 682,000 and will be the anchor tenant for Open Dutch Fiber with a 20-year agreement.
Open Dutch Fiber will be led by Jordi Nieuwenhuis and Uwe Nickl, who have experience in delivering rapid, high-quality, and cost-effective programmes to deploy fiber broadband. Previously, both were co-CEOs of Deutsche Glasfaser in Germany, where they led the roll-out of fixed broadband infrastructure to more than 1 million homes and 6,000 businesses.
Notably, Deutsche Glasfaser was sold by KKR Infrastructure to EQT Infrastructure and OMERS in February 2020. Therefore, KKR is teaming up once again with Nieuwenhuis and Nickl on the Open Dutch Fiber joint venture. They will be joined at Open Dutch Fiber by Michael Griffioen as CEO, who will oversee the company’s day-to-day operations.
Digitisation of the Netherlands
Jordi Nieuwenhuis, the co-founder of Open Dutch Fiber, says, “High-quality and reliable fiber connectivity is essential for the Netherlands and this has only been accelerated with the structural changes to working patterns of companies and citizens brought about by the COVID-19 crisis.”
Nieuwenhuis further continues, “We are building a digital infrastructure platform with open access to all operators, to ensure an efficient and rapid deployment of capital resources, while avoiding uneconomical overbuild. We look forward to making a significant contribution to the digitisation of the Netherlands to benefit Dutch households and businesses.”
KKR will be making the investment through its Global Infrastructure Investors Funds. Its Global Infrastructure strategy, established in 2008, has a team of more than 50 dedicated investment professionals. Currently, the firm manages over $27B in infrastructure assets and has made over 40 infrastructure investments across various sub-sectors and geographies.
Open Dutch Fiber will benefit from KKR’s expertise in digital infrastructure and fiber deployment, following its similar investments in Deutsche Glasfaser in Germany, Hyperoptic in the UK, and FiberCop in Italy.
As for DTCP Infra, it has experience in creating innovative solutions for digital infrastructure development through its financial and industrial partners. It invests in European digital infrastructure across three verticals: towers, fiber, and data centers. Its investments in Swiss Towers and in Community Fiber will come in handy for the benefit of Open Dutch Fiber.