TalkTalk sells FibreNation to CityFibre for £200m

TalkTalk sells FibreNation to CityFibre for £200m

Tristia Harrison.jpg

CityFibre has confirmed the acquisition of FibreNation from TalkTalk Group for £200 million.

The deal, which is subject to TalkTalk shareholder approval, will see CityFibre rollout target increase from 5 million to up to 8 million premises. Additionally, under the terms of the agreement, TalkTalk will also become a major wholesale customer of the company across its consumer and business markets.

“Digital connectivity has the power to transform our country into a nation of smart, connected towns and cities, boosting and levelling up our economy,” said Greg Mesch, chief executive at CityFibre. “Today’s announcement establishes CityFibre as the UK’s third national digital infrastructure platform allowing millions more consumers and businesses to benefit from access to faster, more reliable services. The UK is a service-based economy, and this runs best on full fibre. Ensuring national coverage is critical and this can only be achieved by driving infrastructure competition at scale. This deal demonstrates the appetite from industry to see it established.”

Also included in the deal is the agreement that TalkTalk Group is to be repaid the increase in the amount of intercompany indebtedness between the Group and the fibre assets. Lastly TalkTalk has said that the proceeds of the sale will be used to strengthen the Group’s balance sheet. Together, TalkTalk and CityFibre will start the integration of its systems in preparation for the future launch of TalkTalk’s full fibre services.

"We are pleased to announce today’s agreement with CityFibre, which is good news for TalkTalk, and good news for Britain and its full fibre roll-out ambition. Our investment over the last five years and the excellent work delivered by the FibreNation team, combined with CityFibre’s well-established platform, will support wide-geographic reach of full fibre and further drive competition in the market,” added Tristia Harrison (pictured), chief executive of TalkTalk. "The sale of FibreNation to CityFibre, in combination with a competitive wholesale agreement, enables us to continue our strategy to accelerate TalkTalk’s fibre growth for our residential and business customers, thereby delivering a superior customer experience at an affordable price."

So far TalkTalk has secured approval from shareholders that total 57.5% of the entire issued share capital, and completed has been set for March 2020.

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