KKR acquires 40% stake in Telefonica's Telxius

The transaction gives the business an enterprise value of €3.68bn and will be funded with capital drawn from KKR's second global infrastructure fund, which held its final close on $3.1bn in July 2015.

Following the deal, KKR and Telefonica will invest in two submarine cables: one connecting the US with Brazil, and the second connecting the US with Europe. It will also invest in developing its existing network.

Telefonica will remain the company's primary client and retain a majority stake in the business upon completion.

According to unquote" sister publication InfraNews, the partial divestment by the trade vendor forms part of a "plan B" for Telxius after Telefonica decided to pull the IPO of its telecoms infrastructure affiliate. The parent group is looking to deleverage ahead of a potential IPO of its UK operator O2.

Telxius operates around 16,000 telecommunications towers across five countries and manages 65,000 kilometres of submarine fibre optic cables. According to a statement, the business is looking to capitalise on growing demand for mobile data, virtual reality content and 4k technology.

The deal is subject to regulatory approval.

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• Topics
• Expansion
• Southern Europe
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• Spain