Telefonica completes the 60% sale of its FTTH subsidiary in Chile to KKR

Telecommunications company Telefonica and US multinational company Kohlberg Kravis Roberts (KKR) have officially announced this last Friday, July 2nd, the closing of the transaction for 100% of InfraCO, a standalone company that will be in charge of operating the first free FTTH network access in Chile. The transaction is valued at about USD 1 billion.

According to the information that was officially reported, Telefonica will own a 40% stake in the new company, which will operate as a neutral wholesale business, prepared to operate and accelerate local fiber optic network deployments in Chile, and offer wholesale access for the FTTH business to all telecommunications service providers who, at the same time, offer services to their end users. The remaining 60% of InfraCO will be owned by KKR.

‘The approval of the operation without any type of restriction by the regulators shows the virtue of the model to strengthen the latest generation infrastructures in Hispanic America. In Chile we have the ability to strengthen our leadership’, reported Alfonso Gomez, CEO at Telefonica Hispam, about the transaction.

The company also reported that, through InfraCo, Telefónica and KKR ‘are contributing to a substantial expansion of the access to their fiber optic services and, fue to its open and neutral business model, the company will increase market efficiencies that will directly benefit Chileans at a time when remote education, telemedicine and teleconferencing platforms are essential’. In addition, they indicated that, as an open FTTH wholesale platform, the new entity ‘is in a unique position to value the potential of the Chilean broadband market, contributing to the social, economic and digital development of Chile’.