Apparently, it’s not just Telekom & Co. that has a keen interest in a Germany-wide fiber optic rollout. Now banks and insurance companies have also agreed to fund Deutsche Glasfaser’s innovative broadband solution – with a whopping sum of 5.75 billion euros.
Largest fiber-optic financing
When it comes to Germany’s broadband expansion, “Deutsche Glasfaser” is right at the forefront. This can already be seen in the company’s ambitious plans for the future. For example, 4 million fiber optic connections are to be created by the end of 2025. Another 2 million are to follow in the future. However, if this goal is to be achieved, the speed must be increased. Accordingly, the company wants to significantly increase its expansion speed. Deutsche Glasfaser currently supplies 400,000 households a year with fast broadband connections. By 2025, it would like to have increased this to just under 800,000 households. But the company cannot achieve this under its own steam.
Accordingly, it has been able to secure extensive financial support totaling 5.75 billion euros from a consortium of various lenders. This means that Deutsche Glasfaser has set a real record. After all, the loans are by far the highest funding ever received by a German company for fiber optic expansion. Until now, Deutsche Telekom held this record. It received 900 million euros from investors in Australia. But it is already becoming apparent that Deutsche Glasfaser’s funding will not hold the record for long. Allianz and the Telefónica Group are already planning to push ahead with fiber optic expansion in rural regions. The cost of this is expected to be 6 billion euros.
Loans are to increase speed
Deutsche Glasfaser’s support is primarily intended to increase the speed of the rollout. With its current financial strength, in fact, it would not be possible for the company to go beyond 400,000 households a year. Deutsche Glasfaser’s chief financial officer Jens Müller says in this regard:
“This financing already ensures that we can continue to pursue this plan in the coming years and allows us to increase our expansion speed. At the same time, we are improving our financial flexibility with the transaction.”