Bogota, Colombia and New York--(BUSINESS WIRE)--KKR, a leading global investment company, today announced an agreement with Telefónica Colombia, a subsidiary of Spain’s leading telecommunications group Telefónica, to establish Colombia’s first independent national Open access to wholesale digital infrastructure companies.

The new company’s mission is to provide wider broadband access in Colombia and will expand the availability of ultra-high-speed fiber-optic Internet to benefit more consumers and businesses in Colombia. As part of the agreement, KKR will acquire a majority stake in Telefónica’s existing fiber optic network (the largest fiber optic network in Colombia) and open the network through a newly established independent entity, which will be controlled by KKR as a major shareholder. Telefónica will become a minority shareholder in the new company, holding a 40% stake.

The company will be independently operated by a local team in Colombia, but will bring together the expertise of KKR and Telefónica to build and operate Colombia's first-class digital infrastructure network. Recently, the two companies have also joined forces to establish ON*NET Fibra as the first open-access wholesale optical fiber network in Chile.

After the transaction is completed, Telefónica’s existing fiber optic network will be open for access and can be used by all Internet service providers in Colombia, including Telefónica. With KKR’s investment, the new company plans to expand the existing optical fiber coverage from the current 1.2 million households to at least 4.3 million households by the end of 2024, covering at least 87 urban areas in Colombia, more than half of which are in high-income cities Underserved areas outside the area.

The network will utilize the most advanced technology to provide connection speeds 1,000 times faster than traditional networks currently available to most Colombians, thereby improving quality and coverage. This investment will help bridge the digital divide, promote new 5G connections, and provide more Colombians with opportunities for telecommuting, telemedicine, and virtual education.

"We are very happy to work with Telefónica again to provide wider broadband access to those in need, and to do so in Colombia, we believe that the country is ready for significant growth in the future and is an attractive purpose Local investors," said Waldemar Szlezak, senior director of KKR's infrastructure investment team. "This new venture in Colombia, together with ON*NET Fibra de Chile, demonstrates the potential of investing in innovative financing and growth strategies to promote digital infrastructure in Latin America."

María Fernanda Suárez Londoño, KKR’s senior consultant, added: “More Colombian households and small businesses should have access to ultra-high-speed digital services. KKR’s investment will help bridge this gap by promoting competition and promising to expand the network in Colombia’s cities. This also shows that KKR has the potential for continued growth in Colombia and the region's digital infrastructure."

Alfonso Gómez Palacio, CEO of Telefónica Latin America Spanish, explained: "The agreement with KKR will accelerate the deployment of Colombian fiber at an unprecedented rate. The market showed great potential last year. In addition, fiber will be thousands of people. Homes and businesses that see digitalization as development opportunities create opportunities. This is another step for our company to lead FTTH services in Latin America."

The transaction is valued at approximately US$500 million and is subject to customary regulatory approval.

The new company will be controlled by KKR and will leverage the company's global experience in digital infrastructure and operating and deploying fiber optic networks, including its ON*NET Fibra in Chile, FiberCop in Italy, HyperOptic in the UK, and the opening of Dutch Fiber in the Netherlands.

KKR is investing through its global infrastructure fund. KKR first established its global infrastructure team and strategy in 2008, and has been one of the world's most active infrastructure investors ever since, with a team of more than 50 dedicated investment professionals. The company currently supervises approximately US$28 billion in infrastructure assets and has made more than 45 infrastructure investments in a series of sub-sectors and regions.

Scotiabank and Bank Street will act as joint financial advisors to KKR for this transaction.

KKR is a leading global investment company that provides alternative asset management, capital markets and insurance solutions. KKR aims to generate attractive returns on investment by following patient and disciplined investment methods, hiring world-class talent, and supporting the growth of its portfolio companies and communities. KKR sponsors investment funds that invest in private equity, credit and physical assets, and has strategic partners that manage hedge funds. KKR's insurance subsidiary provides retirement, life and reinsurance products under the management of Global Atlantic Financial Group. References to KKR's investments may include the activities of its sponsored funds and insurance subsidiaries. For more information about KKR & Co. Inc. (NYSE: KKR), please visit the KKR website www.kkr.com and Twitter @KKR_Co.

Telefónica is one of the biggest driving forces of the country's digital economy, with revenue of 5.36 trillion pesos in 2020. The company operates under the Movistar trademark and mainly focuses on mobile communications and connectivity, broadband business services, fiber to the home, pay TV, fixed line communications, and a complete set of digital solutions for large, medium and small companies and enterprises.

Telefónica has optical fiber in 50 cities and municipalities in the country, 210 use fixed broadband, and 965 use 4G LTE mobile connection. At the end of the first quarter of 2021, Telefónica had 19.9 million customer bases nationwide: 16.7 million mobile lines, 1.2 million broadband customers-366,000 fiber optics, 527,000 pay TV and 1.4 million fixed lines.

Media contact Mariajosé Diaz mariajosediaz@dattis.com +57 316 758 5298

KKR Americas: Cara Major or Miles Radcliffe-Trenner media@kkr.com

Telefónica: Dulce Jiménez dulce.jimenez@telefonica.com

Media contact Mariajosé Diaz mariajosediaz@dattis.com +57 316 758 5298

KKR Americas: Cara Major or Miles Radcliffe-Trenner media@kkr.com

Telefónica: Dulce Jiménez dulce.jimenez@telefonica.com