Uniti Group acquires Telstra's fibre-to-the-premises network Velocity for $140m

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Uniti Group acquires Telstra's fibre-to-the-premises network Velocity for $140m

Telco and fibre network operator Uniti Group has acquired Telstra’s fibre-to-the-premises (FTTP) network, Telstra Velocity, for $140 million.

Telstra Velocity comprises Telstra's FTTP network deployed to provide broadband services to Telstra Velocity estates and its South Brisbane Exchange regions. It currently services some 55,000 customers and covers up to 68,000 premises.

The acquisition is Uniti’s latest in a number of fibre network builders, including OptiComm and LBNCo, both of which were acquired within the past two years.

As part of the deal, Telstra also becomes a retail service provider (RSP) of Uniti Group’s national FTTP network.

“This is another remarkable milestone for our young company. To have secured such a large FTTP network aligned to our core strategy which can be integrated quickly to grow our “core plus” infrastructure earnings is a wonderful way to end what has been a completely transformative year for Uniti Group,” Uniti managing director and chief executive Michael Simmons said.

“The agreement struck with Telstra for it to become an RSP of our Wholesale and Infrastructure (W&I) business is perhaps the most significant strategic aspect of this transaction, given the large universe of presently untapped greenfield property opportunities it will enable us to target with Australia’s largest RSP as part of our FTTP offering and associated range of value added services, such as access control, CCTV and perimeter wi-fi services.”

The $140 million purchase price includes an upfront $85 million payment upon completion, $20 million payable over 3 years and $35 million on completion of migration of the assets and services.

Telstra will also pay Uniti a $21.6 million licence fee to continue using the Velocity network as customer services are transferred. The telco also agreed to enter into some wholesale purchasing agreements with Uniti.

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