Speculation is mounting that Australian telco Singtel Optus Pty Limited (Optus) may look to sell its fibre infrastructure assets to a group like KKR & Co. Inc. (NYSE:KKR) (Kohlberg Kravis Roberts) that may also snap up similar assets from TPG Telecom Limited (ASX:TPG). The transaction would be part of a quest to create a major competitor to Telstra's infrastructure unit.

While it is believed that no deal talks are afoot between the pair, sources anticipate a move towards such a structure in the near to medium term following a recent tie up between Optus and TPG Telecom, the latter of which has had assets on the market through Bank of America. A catalyst for the change would be the appointment of the new Optus boss Stephen Rue to replace Kelly Bayer Rosmarin this month. Mr. Rue has run Australia's NBN Co.

TPG Telecom and Optus announced a deal in April to share resources, where Optus will provide TPG Telecom with access to its regional radio access network and the pair will share spectrum in regional Australia. The deal demonstrated that the pair are now prepared to work together. TPG Telecom is known to have been keen to find a buyer for its non-mobile fibre assets, while talks between Optus and Brookfield for a sell down of a minor stake in the telco shows that the Singaporean parent of Optus, Singtel, is open to taking some money off the table when it comes to its Australian interests.

Any deal involving a sale of fibre assets by TPG Telecom and Optus would likely see both parties continue to own a stake in the assets, but it would create a major fibre asset provider to rival Telstra and create substantial synergies when it comes to costs. Meanwhile, KKR is known to have interest acquiring assets in the space after it last year bid for Telecom Italia's fixed network. Both Optus and TPG Telecom have already sold their mobile towers to infrastructure investors and analysts believe this could be the next step in a move that would free up further capital to invest in their businesses.

TPG halted talks with Macquarie-backed rival telecommunications company Vocus Group in November over a sale and leaseback of its non-mobile fibre assets in a deal expected to be worth about $6.3bn. The pair could not agree commercial terms. That deal came after a strategic review was taking place that included a sale process for its Vision Network business, which connects homes to the internet.