Telefonica’s plan to sell stakes in its fibre optic network in Peru to private equity fund KKR and Chilean telecom operator Entel has collapsed.
Chile-based Entel confirmed in a filing to the Peruvian stock market regulator that the deal, initially announced in July 2023, failed due to unmet closing conditions.
The agreement involved Telefonica selling a 54 percent stake in its fibre network to KKR and 10 percent to Entel, while retaining a 36 percent share. The transaction, aimed at reducing Telefonica’s debt by €200 million ($217.8 million), valued the entire network at approximately €550 million, including debt, according to Reuters.
Entel, in its filing on Thursday, cited breaches of specific closing conditions as the reason for the deal’s failure. Despite the setback, Telefonica stated it is continuing discussions with both Entel and KKR to explore options.
The fibre optic network, named PangeaCo, currently operates 3.4 million premises passed (PPs) as of March 2024, with plans to expand to 5 million PPs by 2026. It aims to provide fibre connectivity across 86 provinces in Peru by the same year.
This development is part of Telefonica’s strategy to sell non-core assets to manage its substantial debt burden and fund investments in 5G infrastructure. Telefonica, one of the leading telecom operators in the world, is celebrating its 100-year anniversary.
