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    Reference: 20200081
    Release date: 22 December 2021

    Promoter – Financial Intermediary

    DEUTSCHE TELEKOM AG

    Location

    Description

    The project concerns the expansion of Very High Capacity Networks in Germany. The investments in the years 2021 and 2022 will enable an additional 1.5 m homes/businesses/schools to get access to fibre broadband access networks. The project will bring customers a significant uplift of the broadband service offering up to Gigabit broadband services.

    Additionality and Impact

    The project contributes to the policy objectives of Digital Infrastructure by investing in Very High Capacity Networks (VHCN) located in sub-urban and semi-rural areas. It displays high financial risks due to significant investment costs in front of uncertain revenue flows, which leads to delayed availability of services with significant economic costs for the consumers. The project will accelerate the deployment and generate positive network externalities thanks to the step change in network performance, which will reinforce digital transformation, strengthening competitiveness and innovation. The enhanced network will allow the use of more advanced digital applications and contribute to the resilience of Germany's digital infrastructure. The proposed EIB financing will further strengthen Deutsche Telekom's funding diversification and stability. In particular, the client benefits from favourable lending terms such as long availability period, drawdown flexibility, long tenor of the facility and a notably very sizeable loan amount from a single source. The proposed loan is expected to enable the client to crowd in complementary financing sources for its operation.

    Objectives

    The investments will lead to additional coverage with Very High Capacity networks in carefully selected regional subsets of the Promoter's larger broadband fibre programme. The two key targets of the Promoter's strategy are to reach 25% of all German households and businesses by 2025, with the longer-term target to connect all German households by 2030 with a fibre link.

    Sector(s)

    • Telecom - Information and communication

    Proposed EIB finance (Approximate amount)

    EUR 600 million

    Total cost (Approximate amount)

    EUR 1600 million

    Environmental aspects

    Investments in fixed telecommunications projects (mainly civil works for urban underground cable/fibre roll-out) do not fall under the Annexes of Directive 2014/52/EU amending the EIA Directive 2011/92/EU. The related works have typically limited residual environmental effects as they are mainly carried out alongside existing transport infrastructures such as roads.

    Procurement

    The Promoter is a public company operating in the Telecom sector, which is exempt from public procurement requirements. The procedures applied will be verified in detail during the appraisal.

    Status

    Signed - 3/12/2021

    Disclaimer

    Before financing approval by the Board of Directors, and before loan signature, projects are under appraisal and negotiation. The data provided on this page is therefore indicative and cannot be considered to represent official EIB policy (see also the Explanatory notes).

    Related tags

    Germany Telecom