Virgin Media O2 owners to build wholesale UK fibre network

Shares in BT were down 1.2%. The owners said the network would be available to 5 million homes that are currently not served by the current Virgin Media O2 network by 2026, with an opportunity to expand to an additional 2 million homes.

The owners of British cable group Virgin Media have joined forces with an investment firm to plough around 4.5 billion pounds ($5.5 billion)into a new fibre broadband joint venture that will pass 7 million premises, in direct competition with BT.

Virgin's owners Liberty Global and Spain's Telefonica, plus InfraVia Capital Partners, said the network would also offer wholesale access to other broadband providers. Shares in BT were down 1.2%.

The owners said the network would be available to 5 million homes that are currently not served by the current Virgin Media O2 network by 2026, with an opportunity to expand to an additional 2 million homes. BT has long provided the main wholesale network in Britain, giving access to the likes of TalkTalk and Sky. BT is currently ploughing billions of pounds into its network, extending its fibre offering to 25 million premises by end-2026.

The deal will include 3.3 billion pounds of fully underwritten financing commitments and up to 1.4 billion pounds in equity commitments, the groups said. ($1 = 0.8232 pounds)