Original article ISPreview UK:Read More
A new newspaper report claims that CityFibre is allegedly engaged in “discussions” with Fern Trading, a subsidiary of Octopus Investments, over the potential acquisition of the Fibre-to-the-Premises (FTTP) broadband network built by All Points Fibre Networks (APFN) – itself reflecting an earlier consolidation of Jurassic Fibre, Swish Fibre and Giganet.
CityFibre currently aspires to cover up to 8 million UK premises with their new full fibre network – representing c.30% of the UK (they’ve already done 4.4 million or 4.2m as ready for service). But their original target of hitting that by around 2025 will not be achieved, and the operator has instead made no secret of their desire to boost their growth via mergers and acquisition (M&A) of smaller alternative networks.
In fact, CityFibre has only relatively recently completed or announced the consolidations of several altnets, including LitFibre and Connexin (here). But a separate report has also indicated that the network operator already has “up to” 850,000 homes served by other alternative networks “under M&A exclusivity“ (here), which suggests that even more deals are imminent.
According to The Times (paywall), the acquisition hungry provider is now said to be eyeing up the network assets of APFN for a possible deal (note: CityFibre and APFN already have a wholesale access agreement). The newspaper claims that “discussions” have taken place, although it’s unclear to what level this occurred, and Fern Trading itself has responded to say that APFN “is not for sale“.
However, we’d take that “not for sale” remark with a pinch of salt, particularly as they suffered a pre-tax loss of £35.2m for 2023 and are under similar strains to everybody else. In addition, it’s not clear whether their comment was only in reference to APFN the company or their network assets, or both. Furthermore, there isn’t much in the way of overbuild between CityFibre and APFN’s network across England, which would make them a potentially good fit.
In terms of network size, the FT uses an estimate from Enders Analysis to suggest that APFN’s infrastructure could reach 568,000 premises by the end of March 2025. But an independent estimate of ‘Ready for Service’ (RFS) premises published by Thinkbroadband put them closer to 298,000 premises in March 2025. Sadly, APFN have not shared an official figure in some time.
Finally, CityFibre itself is currently still in the process of trying to secure a £500m equity financing deal with existing investors (here), which is expected to be supported by £1bn of incremental debt funding – potentially enough liquidity to keep them fuelled through to mid-2027. The possibility of further deals may well hinge, at least in part, on the outcome of this.