The companies will have a “co-control model” and deploy fibre in rural and semi-rural areas of the country.
The partners say their intent is “to capture the potential of Europe's largest broadband market”. The two were reported to be in negotiation earlier this month.
They also express commitment to the social, economic and digital development of Germany by providing ultra-fast broadband connectivity to regions with little coverage, through a sustainable and energy efficient network. Germany has one of the lowest fibre penetration rates in Europe.
The project is likely to need investment of about €5 billion over the next six years, contributing to the German government's plan to provide a national converged internet infrastructure by 2025.
Telefónica Group’s engagement will be carried out through its infrastructure subsidiary, Telefónica Infra, which will have a 40% stake, and Telefónica Deutschlad (which operates under the O2 brand), which will have a 10% stake.
Allianz Capital Partners will acquire 50% of the shares of the company on behalf of several Allianz insurance companies ("Allianz") and the Allianz European Infrastructure Fund (Allianz European Infrastructure Fund).
The company will operate as a neutral wholesale operator offering FTTH wholesale access to all telecoms service providers to supply services to end customers.
Allianz has experience in various fibre investments and said it is planning major fibre deployments in France and Austria.
Earlier this month Telefónica Deutschland and incumbent Telekom Deutschland extended their wholesale agreement to FTTH – previously it only covered xDSL access technologies.
Vodafone Deutschland bought Liberty Global's cable infrastructure last year, which it is upgrading – already 12.6 million homes having gigabit access.