Telefonica, Liberty Global to buy broadband network Netomnia in £2bn deal - report

(Sharecast News) - Telefónica and Liberty Global, the joint owners of Virgin Media O2, are reportedly set to lead a roughly £2bn acquisition of the UK's fourth-largest broadband network, Netomnia, in a deal that will narrow the gap with market leader BT Openreach. According to the Financial Times, citing two people familiar with the matter, VMO2's owners are joining forces with private equity firm InfraVia Capital to buy Netomnia through their fibre joint venture Nexfibre.

InfraVia jointly owns Nexfibre, which covers 2.4mn UK homes, with Telefónica and Liberty Global. The deal will add Netomnia's fibre network, which covers 3m homes, to that of Nexfibre, and a part of VMO2's own network.

The combined network will cover roughly 8m homes and give VMO2 access to around 20m premises in total. By comparison, Openreach covers more than 30m homes, 21m of which have full fibre.

According to the FT, the deal could be announced as soon as this week.

Goldman Sachs-backed CityFibre, the UK's largest altnet with coverage of 4.5m homes, had previously claimed to be the player best able to consolidate the UK broadband market and challenge Openreach. It expressed interest in acquiring Netomnia but was now unlikely to match Nexfibre's bid, according to an FT source.

Netomnia, which was founded in 2019, is owned by investors Advencap, DigitalBridge and Soho Square Capital. It was understood that the roughly 400,000 customers on its retail brands, Brsk and YouFibre, will be integrated into VMO2's operations as part of the deal.