UPDATE 1: Houlihan Lokey Working With DNS:NET on Funding Lifeline
Wed Apr 08, 2026 05:54 AM ET: German fiber and telecoms provider DNS:NET is working with Houlihan Lokey to address its new funding need, sources said.
The company previously lined up Kirkland & Ellis as legal advisor, as reported, while lenders tapped Linklaters and Herter & Co. (part of Teneo), after sponsor 3i announced a planned write-down of the company’s equity absent additional funding.
Houlihan Lokey declined to comment, while DNS:NET did not respond to Octus’ request for comment.
Original Story 12:48 p.m. UTC on Feb. 20, 2026
New Coverage: DNS:NET Lines Up Kirkland as It Seeks Funding Lifeline; Lenders Tap Linklaters, Herter; Sponsor 3i Looks to Write Down Equity to Zero on Sector Headwinds
Relevant Documents:
3i Infrastructure Q3 Performance Update
3i 6M to September Results
3i Acquires DNS:NET
3i 2025 Annual Report
German fiber and telecoms provider DNS:NET has appointed Kirkland as legal advisor to address the company’s new funding need, sources told Octus, while lenders have tapped Linklaters and Herter & Co. (part of Teneo).
The appointments come after sponsor 3i Infrastructure plc announced in its third-quarter performance update in early February that, absent available financing, it would likely write down its equity investment in DNS to zero at its March 2026 year-end, after reassessing the investment case.
The company currently has a debt stack of between €300 million and €400 million, sources said, but needs further financing to complete its fiber-to-the-home, or FTTH, rollout. 3i’s last valuation of the company at end-September 2025 put DNS’ equity at £212 million, representing 23p per share, or 5.6% of net asset value.
3i originally invested €182 million to acquire a 60% stake in DNS:NET in 2021 from German private equity firm Deutsche Beteiligungs AG, which retained a 40% stake. The London-based sponsor injected a further €24 million of equity in January 2025, to continue to fund DNS:NET’s fiber rollout, according to 3i’s report for the year ended March 31, 2025.
According to 3i’s February announcement, while DNS continues to perform to plan operationally, there has been a “material worsening of the lending appetite for German fibre roll-out businesses.” The sponsor added that the main trigger of the deterioration was news in December 2025 of a significant restructuring of the debt at the largest altnet rolling out fiber across Germany.
Germany’s largest independent FTTH provider Deutsche Glasfaser entered talks with lenders in late 2025 to deal with its overlevered €7 billion debt stack, and new funding need. The company is still in negotiations with stakeholders after lenders pushed back on an initial proposal put forward by sponsors EQT and Omers in December 2025, to inject €1.1 billion in new preferred equity as part of a restructuring proposal, as reported.
A number of smaller altnet players have also struggled with the high costs, rural locations and longer payback periods plaguing the country’s fiber sector, and appointed advisors to address overlevered debt stacks and funding needs in recent months, including Northern Fiber, Unsere Gruene Glasfaser, Telecolumbus and Ruhrfibre.
Established in 1998, DNS:NET now rolls out and operates a FTTH network in outer Berlin, Brandenburg and Saxony.
3i, DNS:NET and Kirkland declined to comment, while Linklaters and Teneo did not respond to requests for comment.
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