Altice, a French telecommunications company, has entered into an exclusive agreement with Morgan Stanley in an attempt to strengthen the company's finances.
Altice France announced that it has agreed to sell Morgan Stanley Infrastructure Partners (MSIP) 70% of the new company, UltraEdge. The transaction is worth €764 million, which is approximately 29 times the company's 2023 earnings before interest, tax, depreciation and amortization of €26 million. In addition, SFR will enter into a build-to-suit agreement with UltraEdge, which will raise €175 million over the next seven years.
UltraEdge is described as a "nationwide independent distributed colocation provider," with 257 data centers and office space spread across France and a total installed capacity of more than 45MW. UltraEdge provides critical data storage and connectivity services from these locations, which are all linked by SFR's nationwide fiber infrastructure. The data centers' passive infrastructure and equipment will be transferred to UltraEdge, while the servers and active equipment will remain at SFR.
“The transaction reflects Altice France’s strategy around balance sheet management, which notably includes executing inorganic deleveraging through pro-active management of our non-core asset portfolio,” Altice said in a statement.
“Furthermore, the transaction will strengthen Altice France on its objectives to provide best in class telecommunication services to its clients as the data center infrastructure continues to be upgraded, expanded and densified,” it added.
The deal is expected to close in the first half of 2024, subject to usual regulatory approval.
