Deutsche Telekom said it was founding a fiber-optic networks joint venture with regional utility EWE that aims to connect more than 1.5 million German households after winning antitrust approval for the deal to go ahead.
Glasfaser Nordwest, as the 50-50 joint venture has been named, will build out networks in northwestern Germany while also offering access to third-party providers at “fair market prices”, Deutsche Telekom said in a statement.
Germany’s antitrust watchdog cleared the joint venture in December after its owners promised to provide fair third-party access, addressing complaints from the industry that Deutsche Telekom was intent on crushing competition.
Another concession by the joint venture, which was announced two years ago and will invest 2 billion euros ($2.2 billion) over the next 10 years, was to pledge to connect rural customers and not just more profitable city dwellers.
The buildout of fiber-optic networks that can deliver gigabit speeds to households and businesses is picking up in Europe’s largest economy after a slow start and is attracting investor interest.
Challenger Deutsche Glasfaser, majority owned by KKR, this week increased its borrowing capacity to invest in expanding its network to 1.8 billion euros. Rival Inexio was bought last year for $1.1 billion by Swedish infrastructure fund EQT.
