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    HomeAccessLiberty Global, Telefónica and InfraVia form fibre JV for UK

    Liberty Global, Telefónica and InfraVia form fibre JV for UK

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    Virgin Media O2 will be the anchor wholesale cand provide technical services

    Liberty Global, Telefónica and InfraVia are forming a joint venture to build a new fibre network in the UK. It will be 50% owned by Liberty Global and Telefónica, and 50% owned by InfraVia Capital Partners.

    They will construct and operate a wholesale FTTH broadband network that passes 7 million premises and will not overlap with VMO2’s existing network. This and Virgin Media O2’s recently announced fibre upgrade , will create a FTTH footprint of up to 23 million premises.

    The deal “combines the three partners’ infrastructure and financing expertise and UK operating experience, whilst leveraging VMO2’s industrial scale and network construction know-how,” apparently.

    The transaction expected to close by the end of 2022, assuming the usual approvals are won.

    The business plan for the initial roll-out of 5 million homes envisages an investment of approximately £4.5 billion, including investments related to the roll-out, expected connection CapEx and other related set-up costs.

    The three partners will fund their pro rata share of equity funding for the build, up to £1.4 billion in aggregate, phased over four to five years.

    In addition, the JV has obtained £3.3billion of fully underwritten debt financing from a consortium of financing banks, including a £3.1bn capex facility. As part of the transaction, InfraVia will make certain payments to Liberty Global and Telefónica, a portion of which will be linked to the progression of the network build-out.

    Joseph George, CEO at Dufrain, a data consultancy, comments, “With BT taking the lead in [fibre] roll out, Virgin Media O2 has some way to go when it comes to catching one of its biggest competitors. 

    “Virgin Media O2 would be well advised to use some of this sizeable investment on their data strategy if they are looking for long-term success. The winner of this race will be the one who takes charge of their data organisation, bringing it all together in one centralised, compliant place, that is easier to analyse and derive insights from.

    “These can be used to make better business decisions at board level in a fraction of the time, meaning customers get the service they deserve, and the business can expand much more quickly without compromising on profit.” 

    Liberty Global Ventures already has an equal partnership with InfraVia Capital Partners to invest in fibre in Germany.

    In June, Infravia entered into a similar agreement with Poland’s Play, which is owned by French telecoms gropu Iliad, to build out a fibre network. The two also have an agreement in place in France.