Cellcom, IIF sign fiber optic agreement

Fiber optics Photo: Shutterstock

The partners will try to recruit more investors after the project begins.

Cellcom Israel Ltd. (NYSE:CEL; TASE:CEL) and Israel Infrastructure Fund (IIF) have signed an agreement for investing in the IBC fiber-optic venture. The two companies reported the negotiations between them last quarter, and have now signed. Cellcom and IIF will go ahead with the project without any additional partners, but will try to recruit more investors for the project after the agreement is signed and the venture gets underway. The leading candidate for making an investment is Hot, with Partner Communications Ltd. (Nasdaq: PTNR; TASE: PTNR) being another possibility.

The Cellcom-IIF agreement shows that despite all the difficulties and the pessimistic assessments about combining forces, there are nevertheless some who believe that the venture can get off the ground and create competition in communications infrastructure, as envisioned when it was founded.

Major changes in the venture are likely, including the business model, the technological configuration, and a change in relations with Israel Electric Corporation (IEC) (TASE: ELEC.B22), which will have to make a greater effort to deploy the infrastructure.

IEC's share of the venture will fall to 30%, while Cellcom and IIF will each have 35%.

Published by Globes, Israel business news - en.globes.co.il - on March 12, 2019

© Copyright of Globes Publisher Itonut (1983) Ltd. 2019

Fiber optics Photo: Shutterstock
Fiber optics Photo: Shutterstock
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