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Orange in talks to sell fiber assets to get Jazztel deal approved

Staff writer |
Orange has begun talks with several potential buyers for parts of Jazztel's fiber network, which it has agreed to sell to get regulatory approval for the takeover of the Spanish broadband company.

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Nicolas Laederich, an executive who handles regulatory affairs and competition issues for the French telecoms group, said the divestment would be paired with a promise to rent out capacity on the company's fixed network to whoever buys the fiber assets.

European regulators have asked Orange to make these concessions as a condition of approving the 3.4 billion euro ($3.80 billion) deal to acquire Spanish broadband company Jazztel.

The arrangement would bring back a fourth national competitor to Spain's broadband market.

Sources told Reuters last Thursday that European regulators would approve Orange's takeover of Jazztel. The deadline for a decision is June 1.

Orange clinched the Jazztel deal in September to keep up with Spain's leader Telefonica and Vodafone, which were both already present in mobile and fixed services. Vodafone bought national cable operator Ono several months before Orange moved for Jazztel.

Spanish customers are flocking to buy discounted bundles of fixed and mobile services, and Spain is now Orange's second most important market in terms of revenue and sales, after its home country of France.

Laederich said Orange would sell about 720,000 fiber connections that Jazztel had installed in five cities including Madrid, Barcelona and Valencia. The company that buys the fiber assets will also have the right to piggyback on Orange-Jazztel's fixed network via a wholesale agreement so as to be able offer broadband nationally.


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