CityFibre raises £4.9bn to fully finance FTTP rollout
Broadband operator CityFibre has announced that it has raised £4.9 billion in debt finance in a fundraising that will enable it complete its planned rollout of Fibre to the Premises (FTTP) broadband to 8 million UK premises by the end of 2025.
The financing, described as “one of Europe’s largest ever Full Fibre financings”, is comprised of £3.9 billion in committed facilities, as well as a £1 billion accordion facility. The financing is being underwritten by a consortium of banks and investors, including NatWest, Société Générale, Crédit Agricole, BBVA, Intesa Sanpaolo, ING and SEB, alongside core lenders ABN Amro, Lloyds Bank, M&G and the UK Infrastructure Bank (UKIB).
CityFibre’s FTTP rollout, which aims to cover around 30 per cent of the UK, began in 2018 and has been backed by investment from Goldman Sachs, among others. CityFibre has said that, since 2018, it has covered 1.7 million premises in the UK and has a further 1.5 million premises “Ready For Service” through supporting providers.
In addition to helping to finance the completion of this rollout, the new fundraising will also enable CityFibre to bid on contracts being delivered under the UK Government’s ongoing £5 billion Project Gigabit programme. The government recently confirmed that telecoms companies can bid for contracts worth £543 million connecting up to 380,000 premises in hard-to-reach parts of the UK.
The financing was welcomed by CityFibre CEO Greg Mesch, who commented that CityFibre has “the backbone of a third national network”, putting it alongside Virgin Media O2 and BT (Openreach).
Mesch said: “Over the last decade we’ve built a business that has transformed the UK’s digital connectivity landscape for the better. With our rollout now fully financed, backed by so many esteemed financial institutions, we have emerged as a strong national challenger.”
“But CityFibre’s aim is not simply to challenge. It’s to be better. It’s to establish ourselves as the preferred network wherever we build, bringing higher-quality, more affordable infrastructure within reach of millions and unleashing the transformative economic potential of Full Fibre to help level up the UK. We have never been more confident that we will succeed.”
UKIB CEO John Flint added: “We are pleased to act as a cornerstone investor in what will be the largest digital debt transaction in the UK market to date, connecting a third of UK households with fast and reliable broadband throughout England and Scotland. It is clear how important good quality connectivity is for the UK economy, and in addressing regional inequalities.”