Australia's TPG Telecom to sell fibre, fixed assets to Vocus for $3.54 billion

(Reuters) -TPG Telecom will sell its fibre and fixed network infrastructure assets including broadband provider Vision Network to Macquarie and pension fund Aware Super-owned telecommunications group Vocus for A$5.25 billion ($3.54 billion).

Under the deal, Vocus will acquire TPG's enterprise, government and wholesale (EG&W) fixed business and fibre network assets while the Australian telecom operator on Monday said it will retain its radio network infrastructure, mobile and fixed retail and wireless businesses.

Vocus will provide fixed network services back to TPG as part of the deal terms.

The deal follows closely on the heels of TPG and Vocus resuming talks about the sale of TPG's non-mobile fibre assets, after halting a similar discussion nearly a year ago.

TPG expects the deal to deliver net cash proceeds between A$4.65 billion and A$4.75 billion, which the firm intends to use for further management of capital and other investments.

The EGW unit accounted for about 18% of TPG's total fiscal 2022 revenue of A$5.42 billion, while Vision Network currently services more than 410,000 homes across six major Australian capitals and three regional Victorian cities, according to its website.

Australian data services company Vocus Group in August 2023 bid for some of the non-mobile fibre assets of TPG Telecom, one of the country's largest telecom operators, valuing the assets at about A$6.3 billion ($4.10 billion).

The deal comes after TPG Telecom's asset swap deal with bigger rival Telstra - which involves Telstra buying spectrum and transmission towers from TPG, and the latter selling 4G and 5G coverage using Telstra infrastructure - was blocked amid strong regulatory opposition.

TPG shares have fallen 1.7% this year as of the close of business on Friday.

($1 = 1.4848 Australian dollars)

(Reporting by Rishav Chatterjee and Adwitiya Srivastava in Bengaluru; Editing by Lisa Shumaker and Diane Craft)