T-Mobile US will invest $4.9 billion to establish a joint venture with private equity firm KKR & Co. and acquire fiber internet service provider Metronet.
According to information obtained from the Finance and Economics APP, T-Mobile US (TMUS.US) will invest $4.9 billion to establish a joint venture with private equity firm KKR & Co. (KKR.US) and acquire fiber internet service provider Metronet.
According to a statement released on Wednesday, the second-largest wireless operator in the United States will use Metronet's digital and fiber infrastructure to expand fiber broadband services to more homes.
Metronet, headquartered in Evansville, Indiana, is owned by Oak Hill Capital and the Cinelli family. Since 2021, KKR has been a minority shareholder in the company. Oak Hill will reinvest in the joint venture to retain a minority stake, and founder John Cinelli will also retain a minority stake once the transaction is complete.
T-Mobile has been challenging the broadband industry by expanding into fiber networks. In April of this year, the company partnered with investment firm EQT AB to acquire fiber-to-the-home platform Lumos. T-Mobile offers fiber services in eight states, including California, New York, and Illinois.
Metronet's fiber network covers more than 2 million households in 17 states. According to the statement, the company expects to cover 6.5 million households by the end of 2030.
"This is a unique opportunity and a wise, capital-efficient transaction that allows T-Mobile to profit on the foundation of our broadband success," said T-Mobile CEO Mike Sievert in the statement, adding to the company's wireless growth strategy.
The transaction is expected to be completed in 2025, subject to customary closing conditions and regulatory approval.