Tech pioneer McArthur engineers deal to speed up fibre roll out
TalkTalk founder Neil McArthur has engineered a deal to merge his Freedom Fibre business with InfraBridge-backed VX UK to accelerate the roll out of fibre connections.
Infrastructure investment manager InfraBridge will control the combined entity following the close of the transaction, but McArthur and his chief financial officer Darren Woods will operationally run the business.
The deal combines adjacent fibre to the premises (“FttP”) networks focused principally on the North West of England and the Midlands and will boast 285,000 premises passed.
The new business will operate as Freedom Fibre but combine the operations of VX UK and Freedom into a single group, with TalkTalk remaining as a minority shareholder in the combined business.
InfraBridge is a division of DigitalBridge Group, a New York listed digital infrastructure firm managing a $75 billion portfolio of digital infrastructure assets on behalf of its investors.
Freedom Fibre launched in 2020 and offers wholesale-only services on its network and benefits from a long-term wholesale agreement with TalkTalk, the UK broadband provider that McArthur co-founded with Sir Charles Dunstone.
Both VX UK and Freedom Fibre have a strong regional presence in their respective markets. VX UK has a strong presence in Stoke on Trent and the surrounding areas through its unique contract with Stoke City Council, which provides connectivity for local authority premises, underpinning essential local services. VX UK markets its broadband service to local consumers through its LilaConnect brand, alongside a wholesale offering for local ISPs. VX also has fibre assets in Bristol and Colchester.
Neil McArthur
Neil McArthur said: “This is a strategic merger which leverages the strengths of both Freedom Fibre and VX UK to create a larger, stronger and more diverse business backed by two significant investors with ambitions for growth.”
Damian Stanley, Managing Partner, InfraBridge, said: “The combination of VX UK and Freedom Fibre, with the backing of our shareholders, brings together two of the UK’s leading altnets into a new, stronger company. Our businesses are highly complementary, including our geographic proximity, the quality of our network build and our retail and wholesale go-to-market strategies, and we now have a platform with the support of TalkTalk to provide ongoing connections across the enlarged business.”
The transaction is subject to regulatory approvals and is expected to close by the end of Q1 24.
VX UK was advised by Houlihan Lokey; Freedom Fibre was advised by Cameron Barney. Weil and Ashurst provided legal advice to InfraBridge and Freedom Fibre, respectively.
