Merger creates UK’s “second largest” altnet
Tue, 18 Jun 2024 | MERGER
Fill fibre provider Brsk has merged with ultrafast broadband network operator Netomnia in a deal that they say creates the “second largest” altnet in the UK. The combined companies will have a network footprint of around 1.5 million and the merged group will target reaching 3 million premises by the end of 2025.
The merger is said to create the only scaled, capital-efficient retail, wholesale and consolidation platform currently on the market and was hailed by the companies as a “transformative step” for the UK’s telecoms industry.
Netomnia Chief Executive Jeremy Chelot commented: "By merging our network expertise and resources, we are creating a powerhouse to deliver an unparalleled internet experience for our customers, driving innovation and further consolidation among altnets.”
Brsk CEO Giorgio Iovino said that the merger was a testament to the two companies’ “entrepreneurial spirit and experienced teams” and that the merged group is “set to deliver a fibre network that is not only fast and reliable but also future-proof, ensuring our customers benefit today and tomorrow.”
Netomnia and Brsk have used £300 million of debt to build 1.5 million premises Ready for Service (RFS) and have, so far, connected 140,000 customers. A further £900 million of debt is planned to grow their footprint to 3 million premises.
The two firms have raised more than £1.3 billion in capital since 2020, with support from Advencap (a shareholder in both companies), Soho Bridge and DigitalBridge. Advencap and DigitalBridge will commit additional equity funding as part of this raise.
Netomnia recently secured an additional £147 million in debt from new lenders Rand Merchant Bank (RMB) and JP Morgan. The new lenders join existing lenders Barclays, HSBC UK, ING, Alpha Bank, Ares, NIBC, Standard Chartered, Nord/LB, RBC and UKIB.
Jeremy Chelot said: “The additional capital from our investors and support from our lenders is a powerful endorsement of our vision and ability to execute at the highest level."
The merger is set to be finalised over the coming weeks, pending regulatory approval. The merged entity will be led by Jeremy Chelot as CEO and Wil Wadsworth as CFO, with Giorgio Iovino and Ian Kock remaining as CEO and COO, respectively, of Brsk.
With business activity rising among UK services sectors, the industry could be key to driving an increase in UK M&A
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