KKR Acquires Majority Ownership Of Peru’s Fiber Optic Network As Telefonica Divests

Telefonica announced on Friday that it had completed the sale of a 54% stake in its fiber optic network in Peru to KKR, a U.S. private equity fund. Additionally, 10% of the stake was sold to Entel’s local business, while Telefonica will retain the remaining 36%.

In recent years, Telefonica has taken up a series of asset sales planned to decrease debt and support the substantial investments needed to develop 5G mobile networks.

The company has divided the framework into different units to maximize the value of its willing assets in other markets.

Telefonica declared that the agreement would result in a debt reduction of 200 million euros, $217.8 million for the company.

According to a confidential banking source, the transaction placed the unit’s total value, including debt, at approximately 550 million euros for 100% ownership.

In a separate statement, the KKR firm announced that the newly formed company, Pangeaco, will incorporate Telefonica and Entel’s existing fiber optic networks in Peru.

According to the source, Santander provided advisory services to Telefonica for the deal. Additionally, the private equity fund revealed its intention to invest $200 million to expedite the expansion of digital infrastructure. This investment aims to double the network’s size more than and increase its coverage, reaching a minimum of 5.2 million households in Peru by the end of 2026.