TalkTalk has confirmed it is to sell its FibreNation Ltd and TalkTalk’s shareholding in Bolt Pro Tem Ltd to CityFibre for £200 million.
The deal has reportedly been put on ice late last year, when the Labour Party (ahead of the general election) pledged to provide every home and business in the UK with free fibre broadband, and promised to nationalise part of BT – a strategy experts warned at the time would be a “disaster” for the telecoms sector.
In the end Boris Johnson and the Conservative Party won the general election decisively, allowing the deal to proceed.
It was back in 2014 when TalkTalk (and initially Sky and CityFibre) all agreed a trial to build a 1Gbps fibre-to-the-premises (FTTP) service in York.
Both TalkTalk and Sky had wanted to reduce their dependency on the Openreach fibre network.
In the end TalkTalk began installing the network on its own and it reportedly reached 49,000 homes to date in York. In 2018 TalkTalk created a new company (FibreNation), which had the lofty ambition to deploy the FTTP network to 3 million premises.
But now TalkTalk has confirmed it is exiting the venture, with the sale of its fibre assets for $200m to CityFibre. The cash will be used to bolster’s TalkTalk balance sheet.
“We are pleased to announce today’s agreement with CityFibre, which is good news for TalkTalk, and good news for Britain and its full fibre roll-out ambition,” stated Tristia Harrison, chief executive of TalkTalk.
“Our investment over the last five years and the excellent work delivered by the FibreNation team, combined with CityFibre’s well-established platform, will support wide-geographic reach of full fibre and further drive competition in the market,” said Harrison.
“The sale of FibreNation to CityFibre, in combination with a competitive wholesale agreement, enables us to continue our strategy to accelerate TalkTalk’s fibre growth for our residential and business customers, thereby delivering a superior customer experience at an affordable price,” she concluded.
It should be noted that TalkTalk has also agreed a wholesale deal with CityFibre, which will see it switch its residential and business customers to CityFibre’s FTTP networks.
Tristia Harrison told Reuters that the ISP had been working on the deal for a long time.
“We think the value is good, it’s more than three times the investment that we’ve made,” she reportedly said in an interview.
What do you know about fibre broadband? Take our quiz!
Real world consequence of ransomware attacks. A female patient has died as a result of…
Plan to keep majority stake in TikTok, will hinder White House approval reports suggest, as…
Blunt warning from Facebook about blocking news sharing down under, receives equally blunt response from…