The deal, which is subject to regulatory approvals, will see Telefónica and KKR team up to develop and grow their telecom infrastructure activity.
Telxius owns and operates nearly 16,000 telecommunications towers in five countries. It also manages an international network with approximately 65,000 kilometers of submarine fibre optic cables, of which around 31,000 kilometers are owned by it.
Following the deal, Telefonica will remain the main client for Telxius’ tower and cable businesses. It will retain a majority stake and operational control of Telxius and continue to consolidate it into its accounts.
Telefónica said the sale was part of its strategy to optimise its asset portfolio and allocation of capital, and complements its plan for organic debt reduction.
Guillermo Ansaldo, chairman of Telxius said: “Our vision for Telxius is to capitalize on the exponential increase in data traffic forecast for the coming years by offering a first-class network in Europe and the Americas. We are delighted to have KKR on board as a long-term investment partner. We believe their solid track-record on the infrastructure business will help us achieving our common goals.”
Jesus Olmos, member and global co-head of infrastructure and head of Spain at KKR, said: “The combination of Telefónica’s industrial expertise and KKR’s financial and operational support will help Telxius as it continues to scale and grow. We are confident that the exploding demand for mobile data, driven by the rise in 4k and virtual reality content, together with the need for reliable internet infrastructure will help drive strong growth in the business.”