Vodafone Gets 15-Year Rights to Use Turkish State Fiber Lines

Vodafone Group Plc (VOD)’s Turkey division agreed to pay 128 million liras ($61.5 million) to use part of the state power transmission company’s fiber network for 15 years, said Gokhan Ogut, the unit’s chief executive officer.

Vodafone Turkey will increase its fiber network two-and-half times to 16,000 kilometers (9,941 miles) by adding lines from Ankara-based Teias, as the state company is known, Ogut said in a news conference in Istanbul. The unit will invest about 300 million liras in the fiber network, including the fee to Teias, which will be paid in yearly installments, Ogut said.

Vodafone, the second-biggest mobile operator in Turkey, competes with Turkcell Iletisim Hizmetleri AS (TCELL), the biggest, and Turk Telekomunikasyon AS (TTKOM)’s Avea Iletisim Hizmetleri in the country where mobile penetration rose to 91.1 percent at the end of September from 89.5 percent at the end of 2012, according to the market regulator’s website.

“This agreement will not only help us be a key part in Vodafone’s global network of 1 million kilometers of fiber lines but also prepare for the 4G network in Turkey,” Ogut said, referring to the government’s plans to give out licenses in late 2014 for faster mobile communication.

Vodafone will link fiber networks in Iran, Syria, Georgia, Iraq, India and Turkey to its European network as it expands, Ogut said.

Vodafone is ready to share the fiber network with other companies in Turkey, including rival operators, Ogut said. Turk Telekom, Turkey’s biggest telephone company, runs the largest fiber network in Turkey at 174,000 kilometers, according to its website, while Turkcell’s is 33,000 kilometers.

To contact the reporter on this story: Ercan Ersoy in Istanbul at eersoy@bloomberg.net

To contact the editor responsible for this story: Benedikt Kammel at bkammel@bloomberg.net

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