Altice Europe strikes a $1.7B deal for fiber in Portugal

Alice Europe's Portuguese subsidiary MEO has inked a deal with Morgan Stanley Infrastructure Partners to build what it says will be the first nationwide fiber wholesaler in Portugal. As part of the deal, MEO will sell off a minority equity stake of 49.99% in Altice Portugal's fiber-to-the-home (FTTH) assets for an initial price of $1.74 billion. Alice Europe's Portuguese subsidiary MEO has inked a deal with Morgan Stanley Infrastructure Partners to build what it says will be the first nationwide fiber wholesaler in Portugal. As part of the deal, MEO will sell off a minority equity stake of 49.99% in Altice Portugal's fiber-to-the-home (FTTH) assets for an initial price of $1.74 billion. It's the first step in the creation of a nationwide fiber wholesale entity in Europe, and will boost the Portuguese telecom market. The deal also helps Altice Europe pay down some of its debt. Altice Portugal is the largest FTTH wholesaler in the country, with plans of reaching approximately 4 million homes passed by the end of this year. Altice Portugal said it would sell wholesale services to all operators at the same financial terms while MEO will sell technical services to Altice Portugal for FTTH construction, subscribers connection and maintenance of the network. Altice said it was the first time in Europe that an incumbent telecom operator has separated its own fiber into its own dedicated wholesale business. “I am very pleased that our partnership with Morgan Stanley Infrastructure Partners, initiated in the context of our Portuguese tower transaction in 2018, now continues with a transformational fiber project," said “I am very pleased that our partnership with Morgan Stanley Infrastructure Partners, initiated in the context of our Portuguese tower transaction in 2018, now continues with a transformational fiber project,” said Altice Group CEO Patrick Drahi, in a statement. "Following this transaction, Altice Europe has obtained cash proceeds in excess of €5.7 billion through the transformational SFR FTTH transaction and the various tower sales and partnerships announced in 2018. Altice’s portfolio of infrastructure assets continues to grow. "On a 100% proforma basis, SFR FTTH and our towers in France in addition to our fiber and towers in Portugal, already represent more than €0.8 billion of revenues and more than €0.5 billion of EBITDA, effectively constituting one of the largest telecom infrastructure groups in Europe." Drahi also said that the transaction would "accelerate the deleveraging of the Group towards its stated leverage target," and "open the way to significant refinancing transactions in 2020." The cash deal is expected to close in the first half of next year.