Spain's nascent cable industry is set for a major tranche of investment as local cable operator Ono (Cableuropa) has unveiled plans to invest $1.7bn (PTS300,000m) over the next five years to expand its broadband network into new regions of Spain.

The company, which said it plans to build "one of the best and biggest fibre optic networks in Spain", also confirmed rumours that it may launch an IPO before the end of the year.

The initial expansion targets businesses in Madrid, Sevilla and Barcelona via subsidiary Ono Empresas' internet and telecoms services. Eventually the company - which already offers television, telephone and internet services to homes and businesses across several regions in Spain - hopes to reach its claimed potential market of 4 million homes and half a million businesses.

Cable penetration is low in Spain, compared to other European markets, because licences were only handed out in 1998. At the time, the Spanish government said that it expected cable to reach 10.8 million homes in Spain. At the end of March 2000, Ono had passed 473,493 homes, up 30% from the end of 1999 and reported 53,389 subscribers, up 76% from December.

Ono offers three cable TV packages ranging in size from 33 to 50 channels at a flat rate monthly cost of between $7-20. The company's shareholders include BSCH, GE Capital, Bank of America, Caisse de Depot et Placement du Quebec, Grupo Ferrovial and Multitel Cable. Ono is managed by Callahan Associates International. Richard Alden was named CEO of the company last month.