DJ Royal KPN N.V. Press Release: KPN further accelerates fiber rollout through JV with APG
Royal KPN N.V.
Royal KPN N.V. Press Release: KPN further accelerates fiber rollout through JV with APG
23-March-2021 / 07:30 CET/CEST
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KPN further accelerates fiber rollout through JV with APG
. Strengthening KPN's strategy as leading fiber operator in the Netherlands
. 80% FttH coverage by 2026 with JV taking up KPN's long tail, on top of existing fiber rollout plans
. Further accelerating fiber rollout through JV to 685k households in medium-dense areas and to 225k businesses
. EUR 440m cash payment over time by APG for 50% ownership, crystallizing the value of KPN's state-of-the-art fiber
network
Rotterdam, 23 March 2021 - Today, Royal KPN N.V. (KPN) announces it has signed an agreement with APG to participate in
a joint venture to further accelerate the rollout of fiber and lead the digitalization of the Netherlands. Through the
joint venture, KPN strengthens its 'Accelerate to grow' strategy and reaches maximum rollout speed.
KPN will continue to pursue its existing fiber rollout plans of 2.5m additional fiber households in the coming five
years. On top of this, the new JV will take up the long tail of KPN's fiber rollout plans and will cumulatively roll
out 910k additional fiber connections in underserved areas in the coming years. This consists of 685k households in
medium-dense areas and 225k businesses. As a result, the FttH network owned by KPN and the JV will jointly cover
approximately 80% of Dutch households by 2026, with scope to finalize the rollout in the years thereafter. In addition,
the JV extensively expands its fiber footprint in business areas.
APG has agreed to pay EUR 440m (pre-tax) for a 50% stake in the joint venture, subject to closing adjustments and split
in an initial payment of EUR 220m and another EUR 220m to be paid in annual installments based on the rollout progress.
The total equity value of EUR 880m for the JV implies an equity value of EUR 970 per line. Over the rollout period, Capex
of the JV will total approximately EUR 1.2bn, financed with 70% debt on a non-recourse basis. The initial payment more
than covers KPN's share of expected equity contributions in the JV. Almost all construction capacity as well as Capex
financing commitments for the fiber rollout have been secured. The transaction is subject to regulatory approval, with
the JV expected to start operations in Q2 2021. The JV will initially be deconsolidated, with KPN having a conditional
call option on 1 share. As a result, KPN has the potential to obtain control and reconsolidate in the future.
Joost Farwerck, CEO of KPN: "This strategic partnership with APG marks a next step in the acceleration of our fiber
rollout in the Netherlands and shows we can act quickly on opportunities in the Dutch market. It is an attractive
transaction, creating additional value for all stakeholders. Through this JV we further accelerate the fiber rollout
and bring forward the long tail in smaller villages and business parks. It ensures almost nationwide fiber coverage by
2026. Together with 5G, our state-of-the-art fiber network creates the most modern and powerful network, supporting the
Netherlands well into the 21st century."
This strategic partnership further strengthens KPN's strategy as the leading fiber company in the Netherlands.
Furthermore, it supports KPN's strategy by growing service revenues and strengthening the customer footprint in less
densely populated areas. It also enables accelerated savings related to phasing out of services on the copper network.
The joint venture will pursue an open wholesale policy, based on voluntary offers and long-term contracts. KPN will be
an anchor tenant on the network that is being built, operated, and maintained by the joint venture, but the network
will be open for any third-party operator, fostering competition and innovation in the Netherlands.
In APG, one of the largest pension investors globally, KPN has found a long-term, reliable, and mutually reinforcing
partner with a Dutch heritage. A strong partner in its aim to provide fiber to families and businesses in the
Netherlands.
This transaction illustrates KPN's ability to access long-term pension fund capital at attractive terms to help further
accelerate and increase the rollout of a part of our state-of-the-art fiber network whilst crystalizing significant
value for KPN upfront.
Conference call at 10h00 CET
KPN will host a conference call at 10h00 CET. A supporting presentation has been published on the KPN website:
ir.kpn.com. You can register for the call via this link.
Company profile APG
APG Group is one of the world's largest independent pension fund managers with pension assets of
c.EUR 575bn (as of Q4 2020), representing over 30,000 employers and 4.7m participants in the Netherlands, with offices in
Amsterdam, Heerlen, Brussels, New York, Hong Kong, Shanghai and Beijing.
On behalf of its clients (all of which are Dutch pension funds), APG has been an active infrastructure investor since
2004, investing c.EUR 16.5bn to date and managing >35 direct stakes in portfolio companies. APG's investments include
assets within energy and utilities, telecommunications and transport infrastructure.
For more information:
KPN Royal Dutch Telecom
Investor Relations
Wilhelminakade 123
3072 AP Rotterdam
E-mail: ir@kpn.com
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Dissemination of a CORPORATE NEWS, transmitted by EQS Group.
The issuer is solely responsible for the content of this announcement.
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1177417 23-March-2021
(END) Dow Jones Newswires
March 23, 2021 02:30 ET (06:30 GMT)
