Paris-based Vauban Infrastructure Partners and Axione, a digital infrastructure developer in which the French firm holds a 49 percent stake, are launching a new platform aimed at accelerating digitalisation across the country.
“Vauban Infra Fibre is a company that is going to hold all the broadband networks, which we have already developed and that we will further develop under a platform strategy,” the firm’s chief executive and founding partner Gwenola Chambon told Infrastructure Investor.
“It’s an ‘infra company’, that will hold broadband networks, most of which will operate and maintain networks with Axione,” she explained, referring to the joint venture Vauban has established in partnership with Bouygues Energies & Services, and which owns the remaining 51 percent in Axione.
According to a statement, the new company’s “large-scale development” targets a total of 11 million FTTH plugs in the next two years. It’s a €6 billion project, of which €4.3 billion has already been committed.
Asked through which fund Vauban would be investing in the new platform, Chambon said that all Vauban funds will be stakeholders in the new company. “Successive vehicles of existing funds will provide future fire power, just as CIF III has provided fire power for the current transactions in closing,” she added, referring to the firm’s latest flagship vehicle – Core Infrastructure Fund III – the firm is in the process of raising, but declined to provide details as it has yet to reach final close.
“So, it’s really our funds and our investors, alongside prospective financial partners, which are pursuing their commitments towards broadband opportunities, while reinforcing their existing exposure into a consolidated and diversified portfolio of broadband networks,” Chambon said.
One of the unique selling points of Vauban Infra Fibre, according to the firm, is that it is open to all operators.
“When we’re talking with our retail operator clients, the fact that you can provide access to 11 million plugs makes you much more interesting for clients than if you were just operating one or two concessions,” Chambon said.
“For us, it’s a strategic move to become bigger, stronger and in a position to grasp the further potential of this sector in France, which we perceive to be very high.”
Chambon acknowledged that covid-19, which has resulted in lockdowns, travel restrictions and an increase in remote work and remote study, has underscored the essential nature of digital infrastructure, but it was not the driver behind this new venture.
From ADSL to fibre
“We decided to invest in broadband from 2009, because we were aware of the huge potential for development in rural areas,” Chambon said. “Since then, there has been such a boom in internet usage across dense and less dense areas. We perceived the potential, but we never anticipated that it would be so huge and that people would connect to our networks in rural areas as soon as they would be rolled over with almost no ramp-up.”
According to the Vauban website, the firm has invested €1 billion of equity in 21 projects since 2009. These include 19 Public Initiative Networks, mainly located in rural areas where Vauban currently has a market share of roughly 20 percent; and CityFast, a project company created in order to commercialise its FTTH network access in urban areas, with Bouygues Telecom using 70 percent of network capacity and 30 percent allocated to alternative operators.
Earlier this week, Vauban finalised the Asterix project, a joint venture with Bouygues Telecom, that will hold the rights to access the FTTH network of telecom operator Orange in medium dense areas in France.
“The company plans to invest nearly €1.3 billion with almost €900 million of debt underwritten by Crédit Agricole CIB, to access up to 2.5 million FTTH connections,” Chambon said, noting that Asterix will complement Vauban’s portfolio of assets in urban and rural areas.
Vauban would also consider investing in data centres, but according to Chambon, the right opportunity hasn’t presented itself yet. “We are interested in regulated and resilient assets. The data centres we’ve looked at either looked more like a real estate or private equity opportunity,” she said.
“So, we need to find the appropriate data centre that matches our investment strategy, but it’s definitely of interest.”
She also ruled out raising a digital infra-only fund, as Vauban wants its vehicles to be diversified. The objective would be to carve out a 20-25 percent allocation within each fund dedicated to broadband, Chambon said.