Open Fiber has raised €3.5 billion from a pool of commercial banks, Cassa Depositi e Prestiti and the European Investment Bank (EIB) to fuel the firms FTTH push across Italy.
The investment will be pooled together with resources made available by shareholders and recent profits to bolster spreadsheets to $6.5 billion. The plan is to expand the firms fibre footprint to 19.5 million homes, both in urban and rural regions.
“The financial market has shown great interest in the Open Fiber Industrial Plan,” said Elisabetta Ripa, CEO of Open Fiber. “The transaction involves the most important Italian and international credit institutions. This is an important sign of confidence in the project, in the wholesale only model and especially in the Open Fiber people who have done a fantastic job in recent months.”
“The presence in the pool of lenders of several foreign financial intermediaries of primary importance is, implicitly, a sign of confidence in our country, significant in a phase of nervousness of the markets; the operation is also a new demonstration of the growing attention of the markets for the validity of the business model adopted by Open Fiber and other innovative European companies, the most suitable to meet the need to realize, with long-term investments, the infrastructures new generation network for the Gigabit Society,” said Franco Bassanini, President of Open Fiber.
Open Fiber has been making the right noises in recent months, though the Italian market on the whole might look like a very different place before too long. And not a moment too soon for customers who have been experiencing average broadband download speeds of 15.1 Mbps.
Aside from the fibre assault here, board reshuffling and arguments with the Italian government have meant the fixed business unit will be spun off into its own separate, though still 100% owned, business. The move is very similar to the BT/Openreach separation in the UK, though some might hope the same shambles isn’t experienced in Italy.