CMA Could Stop £2 Billion Fiber Deal

The UK’s Competition and Markets Authority (CMA) has identified preliminary antitrust concerns regarding Nexfibre’s proposed acquisition of fellow broadband provider Netomnia. These provisional findings could potentially derail the transaction.

The CMA stated that because both entities compete as wholesale providers within their respective network footprints, there is a risk of overlap that could result in increased prices for consumers. The regulator has requested that both companies propose remedies within the next two weeks, while interested parties may submit comments on the report until October 23. A final decision is expected by December 15.

Nexfibre, which is owned by Liberty Global, Telefonica, and InfraVia Capital, announced the agreement to acquire Netomnia in February. If the transaction proceeds, VMO2—also owned by Liberty Global and Telefonica—has pledged to commit traffic across 4.6 million homes. The CMA noted that while some uncertainty remains regarding the timing of future upgrades, it is satisfied that there is a long-term incentive for the operator to follow through with the plan.

“The CMA’s Interim Report does not reflect the commercial and competitive reality of Britain’s fiber market. It fails to prioritize the fiber investment the country needs, and the creation of a scaled, sustainable challenger to Openreach,” Nexfibre stated in a joint response on behalf of its shareholders. In its report, the watchdog also suggested that CityFibre would likely have sought to acquire Netomnia had Nexfibre not acted. CityFibre has called for the CMA to block the deal.