MasOrange and Vodafone Spain Sign Deal to Create Largest FibreCo in Europe

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MasOrange and Vodafone Spain Sign Deal to Create Largest FibreCo in Europe
Vodafone Spain and MasOrange have entered into a binding agreement to create a new fibre-to-the-home (FTTH) network operator in Spain (FiberCo). The new joint venture company (FiberCo) will bring together network assets from Vodafone Spain and MasOrange to create an FTTH network covering 12.2 million premises, with equal, exclusive access for the two service providers. They aim to complete the deal in the first half of 2025 and bring in a financial investor to own 40 percent of the venture.

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Also Read: Zegona Communications Completes Acquisition of Vodafone Spain

Enhancing Spain’s High-Speed Connectivity

FibreCo is expected to transform the Spanish telecom market, offering high-speed internet to over 4.5 million existing Vodafone Spain and MasOrange customers and supporting the rapid adoption of advanced technologies like XGSPON.

“This will be the largest and most highly developed FibreCo in Europe, benefiting from having virtually all its FTTH network already built and with nearly 40 percent existing network utilisation, providing FTTH services to over 4.5 million Vodafone Spain and MasOrange customers,” Zegona said in a statement on January 2, 2025.

Zegona and Vodafone Spain

Zegona was established in 2015 with the objective of investing in businesses in European Telecommunications. Zegona, led by former Virgin Media executives, completed the 100 percent acquisition of Vodafone Spain for EUR 5.0 billion on May 31, 2024. Vodafone Spain is a national provider of fixed, mobile and TV services in Spain, serving consumer, business and public administration customers.

Sustainability and ESG Commitment

According to Zegona, the network, built with a focus on sustainability, will meet high ESG standards, optimizing energy efficiency and ensuring future-ready infrastructure. Vodafone Spain will use FibreCo to provide services to both its retail and wholesale customers within FibreCo’s footprint.

Also Read: Masmovil Group Fibre Network Reaches 29 Million Homes Passed in Spain

Financial and Strategic Impact

FibreCo is projected to achieve a run-rate EBITDA of EUR 480 million within three years. Plans are underway to bring in a third-party financial investor, with MasOrange retaining a 50 percent stake, Zegona Communications holding 10 percent, and the investor taking the remaining 40 percent.

“Initial interest from investors is strong, reflecting the high quality and utilisation of FibreCo, its already built FTTH infrastructure and the multi tenant nature of the company. As a result, we expect FibreCo to be a highly valued asset commanding a significant valuation premium,” the official release said.

Complementing Agreements with Telefonica

This move complements Zegona’s earlier agreement in November 2024 with Telefonica to create a new fibre network company covering 3.6 million premises across Spain and to renew its fibre wholesale access contract with improved terms. “The combination of these transactions with the new FibreCo with MasOrange completes the transformation of Vodafone Spain’s fixed line strategy, delivering full FTTH services nationally,” Zegona added.

The Chairman and CEO of Zegona, commented “Entering this FibreCo partnership with MasOrange, alongside our recently announced agreements with Telefonica, transforms Vodafone Spain’s fixed line strategy. The combination will give guaranteed access to a future-proof all fibre national network with attractive economic terms and will enable substantial cost savings across the business. Monetising these two FibreCos is expected to deliver very significant Zegona proceeds, generating the ability to reduce leverage and provide a return of capital to shareholders.”

Also Read: Orange and Masmovil Receive Clearance for Joint Venture in Spain

MasOrange

According to the official release, MasOrange provides fixed, mobile and TV services for residential and business customers across Spain and is the market leader by the number of customers. MasOrange was formed in 2024 through the combination of Orange Spain and MasMovil and is owned 50 percent by Orange Group and 50 percent by Lorca JVco Ltd, which is majority-owned by Providence, Cinven and KKR.

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