Telefonica Brazil did not rule out acquisitions to bolster its Vivo brand’s internet offering, after being linked to buying rival ISPs, despite plunging year-on-year income. 

In an earnings call, Telefonica Brazil CFO David Melcon said the operator is “always attentive to market opportunities in every way, and that also includes fibre”.

Melcon highlighted the company has a target to gain 29 million internet connections by the end of 2024 with six million stemming from joint venture FiBrasil and the other 23 million stemming from its Vivo brand.

Currently, Vivo has 21 million connections a rate which is “on pace” to hit target said Melcon, which is why the operator is not rushing into mergers and acquisitions.

“If we are going to face any M&A decision in the future it depends on the overlap of the network, on the quality of the network and the quality of the companies being sold.

“M&A is complex [in fibre]. We also need to see how we are going to integrate our customer base because one factor to consider is buying the network, and the second is buying the customer [base]. We have a clear plan to get to 29 million and that’s building together with FiBrasil, » said Melcon.

In its Q2 2022 financial results, the company reported a net income year-on-year plunge of 44.6% to BRL746 million (US$140m) due to higher expenses stemming from its mobile unit.

There was a 282% surge in operating costs to BRL601 million as the company took on debt to pay for 5G licenses in Brazil’s recent auction, and acquired rival Oi’s mobile assets, at a time of higher interest rates.

EBITDA  amounted to BRL 4.5billion which was an increase of 8.3%, while net revenues grew 7.8% to BRL11.8 billion.

A major debt finance deal promises to enable open access fibre provider MetroFibre Networx to bring more fibre connectivity to underserved markets in South Africa.

According to local press reports, major financial institution the Standard Bank Group says it has finalised a R5 billion (about US$295.5 million) debt finance package to support MetroFibre Networx’ ambitious fibre-optic data network rollout across South Africa.

The financing will be used to expand MetroFibre’s fibre connectivity into homes and businesses in underserved communities, contributing to increasing its reach by an additional 500,000 households across the country.

Metrofibre Networx, a carrier-class Ethernet (CE 3.0) infrastructure company that provides highly managed fibre optic broadband connectivity in South Africa, is one of a number of companies targeting less well-off customers.

Openserve, Frogfoot and Vumatel are among the other big names in a market where fibre network operators are cutting prices and increasing line speeds to win over customers.

News service ITWeb Africa points out that there is fierce competition driving the move into underserved markets such as townships. There also appear to be business opportunities.

On its website MetroFibre refers to its recently launched MetroConnect solution as a new “pre-paid pay-as-you-go service which provides a 20Mbps fibre connection into your home with the flexibility to top-up when you need to, for as long as you need it”.

It also describes the new service as one of the ways in which the company aims to “transcend the limitations that lock millions of South African homes out of access to fibre connectivity and leave them reliant on expensive and limited mobile connectivity”.

How long this competition can continue is unclear, though, judging from the MetroFibre Networx finance deal, there’s still a lot to play for in the market.

In a move I didn’t expect, but perhaps should have, a significant metro fiber M&A was announced this morning. BAI Communications has agreed to acquire the New York/New Jersey fiber operator ZenFi Networks. … [visit site to read more]

The FTTH space continues to see new entrants sprouting up in underserved areas. Late last week out in the Midwest the latest effort took shape with the launch of Omni Fiber by Oak Hill Capital. … [visit site to read more]

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Some data center projects, an FTTH provider creation, and the closing of a key acquisition: … [visit site to read more]

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Keep up-to-date with all the latest news, articles, event and product updates posted on Developing Telecoms.
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