**Deutsche Glasfaser Explores Alternatives Amid Equity Challenges**
**Meta Description:** Deutsche Glasfaser is considering options as it faces hurdles in raising preferred equity, with ongoing efforts to secure funding for its fiber expansion.
**URL Slug:** deutsche-glasfaser-equity-options
**Headline:** Deutsche Glasfaser Considers Alternatives as Preferred Equity Efforts Stall
Deutsche Glasfaser Holding GmbH, a prominent German fiber company, is actively exploring alternative strategies in light of potential setbacks in its efforts to raise preferred equity. The company, which is backed by private equity firm EQT Corp. and Canadian pension fund OMERS, is collaborating with Lazard Inc. to evaluate its options, according to sources familiar with the situation.
In addition to this, the Boston Consulting Group is conducting an independent business review to assess the company’s current standing and future prospects. Despite these challenges, Deutsche Glasfaser is continuing its pursuit of preferred equity, a process that has been ongoing since July, as reported earlier.
Goldman Sachs Group Inc. is leading the fundraising initiative, but so far, these efforts have not yielded a successful deal. Shareholders are reportedly prepared to invest €600 million (approximately $705 million) in equity, indicating a strong commitment to the company’s future.
Deutsche Glasfaser is seeking new capital to support its business plan, but the fiber sector is facing significant challenges due to rising construction and financing costs. The company previously attempted to raise funds through new equity offerings, but potential investors expressed concerns over its high leverage. Currently, Deutsche Glasfaser carries a debt load of around €7 billion, which was incurred to finance its fiber-to-the-home rollout in rural and suburban areas of Germany.
EQT and OMERS acquired Deutsche Glasfaser in 2020, with EQT holding a 51% stake and OMERS owning the remaining 49%. The company competes with Deutsche Telekom AG and other smaller players in a market characterized by relatively low fiber penetration in Germany.
As Deutsche Glasfaser navigates these financial challenges, the outcome of its preferred equity efforts and the exploration of alternative options will be crucial for its future growth and competitiveness in the fiber market.
**FAQ Section**
**What challenges is Deutsche Glasfaser facing in raising equity?**
Deutsche Glasfaser is encountering difficulties in raising preferred equity due to high construction and financing costs, as well as concerns from potential investors regarding its significant debt levels.