DWS to invest in Deutsche GigaNetz

DWS, one of the world’s leading asset managers, signed a binding agreement to acquire a significant stake in Deutsche GigaNetz.

Funds managed by InfraRed Capital Partners (“InfraRed”), the international infrastructure investment manager majority owned by SLC Management, the institutional alternatives and traditional asset management business of Sun Life Financial Inc, with c. $12bn equity under management, remain fully invested and will further increase their investment. The Founding Management team also remains invested.

The transaction is subject to the approval of the European Commission (EC) due to the size of DWS’s majority shareholder, Deutsche Bank AG and InfraRed’s parent company, Sun Life Financial Inc.

"With DWS and InfraRed we are honored to have two very large and experienced investors as partners for our long-term growth. The investment commitments will further increase our capabilities to grow beyond our initial business plans, which was based on a €3 Billion investment program with the ambition to connect more than one million households with pure FTTH," said Jan Georg Budden, CEO of Deutsche GigaNetz GmbH. "As a result of these supportive investors, and the outstanding performance of all employees as well as from its partners, Deutsche GigaNetz has significantly outperformed its business plan over the last two years. We expect to continue this strong development and as of today have agreed to deploy large-scale high-quality fiber networks for retail, corporate, public and also carrier clients with currently over 100 communities and cities as well as the two gigabit regions Heilbronn-Franken and FrankfurtRheinMain.”

Thomas Kalthöfer, Senior Principal for Infrastructure Investments at DWS, considers the greenfield approach based on Deutsche GigaNetz' sophisticated fully scalable platform to be the most compelling strategy in a market which requires more investment to drive digitalization in Germany: "Deutsche GigaNetz is helping to provide fast, reliable and cost-effective fibre and high-speed internet connectivity. Fibre to the home is key for a modern digital society, enabling flexible working from home, online education and multitudes of digital services. DWS is excited to work with Deutsche GigaNetz to invest even more in Germany. "

Deutsche GigaNetz is an attractive investment given the future-proof nature of internet infrastructure investments in Europe´s largest and strongest economy, and its data-driven roll-out strategy paired with an experienced high quality management team will allow DWS and InfraRed to allocate significant capital over time.

InfraRed, the original investor remains fully committed to Deutsche GigaNetz’s long-term plans and has allocated further investment to Deutsche GigaNetz. Thomas Buss, Director at InfraRed said: “This investment reflects InfraRed’s ongoing commitment to investing in developing sustainable infrastructure for tomorrow’s smart cities and connecting people to employment, education and each other. As a national operator, Deutsche GigaNetz has a key role to play in ensuring communities in Germany remain competitive in times of digitisation. Good Topspeed internet connectivity is a key factor when companies select certain locations.” 

Deutsche GigaNetz is committed to the transition towards a more future-oriented internet infrastructure in Germany which brings better and more accessible services to the people in less connected communities. From a technology perspective, fiber is not only the endgame in terms of data communication and transport, but it will also allow significantly better services and savings for all consumers in times of increasing inflation. FTTH infrastructure will also lead up to 2 to 6 times less energy consumption compared to copper or cable networks. (BREKO Sustainability Assessment, May 2022).

Jan Geldmacher, Chairman of the board, is pleased with the Deutsche GigaNetz approach in terms of strategic rational and operational capabilities. “Deutsche GigaNetz has continuously delivered and outperformed its targets. Based on this success, management has laid a solid base for the future and a nationwide roll out as quality leader with a strong brand.” Deutsche GigaNetz is a true success story with large potential. Its Initial focus on the retail and business segment will be expanded in the near future to offer also open access and in close cooperation with municipalities connections to the mobile base stations required for the 5 G network deployments.