Potential acquirers include Virgin Media O2 and its parent companies
Trooli, a fibre altnet provider in the UK, is up for sale. A number of buyers are eyeing it up, including Virgin Media O2 and the two groups who own the joint venture, Liberty Global and Telefónica.
The price tag is expected to be more than £100 million, Sky News says.
Liberty Global, Telefónica and InfraVia Capital Partners set up Nextfibre as a fibre altnet the UK last year with the goal of passing 7 million premises. Virgin Media O2 is its anchor client.
Trooli’s aims are more modest – to pass 1 million premises in rural and semi-rural areas in south-east England by the end of 2024. Having failed to secure another round of funding last year, it has been seeking a new investor or buyer since.
The UK has more than 100 altnet fibre providers, consolidation is to be expected, and especially as tougher economic conditions begin to bite.
At the beginning of February, one of the largest, CityFibre, announced the loss of 400 jobs – about 20% of its workforce – as it seeks to cut costs The Telegraph reported.
Regulation is also having a big impact: Cityfibre, other alt-net providers and their backers have complained to regulator Ofcom that planned wholesale price cuts, by BT’s semi-detached access division, Openreach, will inhibit investment in fibre build-out to the tune of £20 billion. Openreach’s new pricing structure, known as Equinox 2, was announced last December.
Also in December, CityFibre lodged a Competition Act complaint with the Competitions and Markets Authority (CMA) and Ofcom that alleges, Openreach, BT’s wholesale access arm, “undertaking an aggressive strategy to foreclose infrastructure competition in the UK fibre broadband market.”
Previously CityFibre unsuccessfully appealed against Equinox 1 in December 2021, taking issue with Ofcom’s decision-making process – how it reached its conclusion regarding the fairness of the pricing.
Others weight in early in 2022, with BT and Sky Broadband supporting Ofcom’s decision on Equinox but smaller altnets like County Broadband, Jurassic Fibre, Swish Fibre and others taking CityFibre’s part.
Objectors to Equinox 2 must file them with Ofcom by 4 March Consultation: Openreach Proposed FTTP Offer starting 1 April 2023. Opinion seems to be that Ofcom will wave it through as it did Equinox 1. If that is the case, consolidation is likely to accelerate.