Orange’s strategy has received a major boost in Poland following an agreement with the Dutch pension fund managing group APG.
It will result in the creation of a 50/50 joint venture named Swiatlowod Inwestycje (Optical Fibre Investments) that will by 2025 operate a fibre network reaching around 2.4 million Polish households. Orange Polska will contribute around 0.7 million fibre connections, with the remainder being rolled out by the joint venture to create what will become Poland’s largest wholesale fibre operator.
Although 2020 was a challenging year for Orange in Poland, it reached the important milestone of 1 million TV customers in October. Furthermore, its broadband fibre customer total rose from 520,000 to 725,000, with a record 63,000 being added in the fourth quarter alone. As of the end of the year, over a quarter (27%) of fixed broadband customers were offered services via fibre.
Last August the incumbent announced the creation of a co-controlled vehicle (FiberCo) that would seek out potential partnerships for the further rollout of fibre network, predominantly in areas still without fast broadband infrastructure. This effectively paved the way for the joint venture with APG, which has been valued at €605 million. Orange Polska will receive €303 million from APG, with 65% being transferred on closing of the transaction and the remainder in stages as the fibre deployment progresses.
Significantly, the creation of Swiatlowod Inwestycje mirrors that of Orange Concessions by its parent company in France. Announced in January this year as a 50/50 joint venture with La Banque des Territoires (Caisse des Depots), CNP Assurances and EDF Invest and valued at €2.675 billion, it will become the leading fibre network operator in rural France, with over 4.5 million FTTH connections.
Both joint ventures form part of Orange’s Engage 2025 plan, which also includes the creation of a European TowerCo. Named TOTEM, it will initially cover France and Spain but may in due course also include other Orange markets in Europe.
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