Hyperoptic switches private equity owners

UK independent fibre provider Hyperoptic has had the majority of its ownership switched from lot of investment companies to another.

The new lot in control of the company is HKK, an investment company that seems to get involved in every industry in every part of the world. It acquired its stake in Hyperoptic from fellow investment companies Newlight and Mubadala. The terms of the deal weren’t revealed so we don’t know exactly how much of Hyperoptic owns or how much it cost, but this does seem to be the first time is has had a single majority owner for a while.

“We are incredibly grateful to Newlight and Mubadala for their unwavering support and significant contributions to the success of Hyperoptic,” said Hyperoptic CEO Dana Tobak, who will remain in place. “Currently, only 8% of the UK has access to full fibre and less than half of that to symmetrical gigabit services.

“We are confident that with the support of KKR and their significant expertise enabling high-growth businesses, our ambitious infrastructure plans to build our hyperfast network out to two million homes by 2021 and five million by 2024 will be realised.”

“Hyperoptic has a market-leading position and superior consumer product,” said two people from KKR in unison, apparently doing some kind of duet. “The business is strongly positioned to meet the growing demand for full-fibre services in the UK through further investment and national roll-out, supporting housing development and renovation. Our investment in Hyperoptic builds on KKR’s strong track record in telecommunications infrastructure in Europe, investing in and deploying next-generation digital connectivity.”

Meanwhile fellow UK fibre indie CityFibre has started an industry consultation on the role of such companies in the overall switch from copper to fibre. The move has apparently been prompted by the progress of CityFibre’s rollout in Stirling, which is set to switch to fibre-inly next year. There needs to be some kind of consensus about how best to support legacy services when the switch happens, the establishment of which seems to be the main point of this consultation.

“Only by collaborating as an industry, with the full support of government and Ofcom, will we be able to switch-over the UK from legacy copper networks to a future-proof full fibre platform,” said Greg Mesch, CityFibre CEO. “Our consultation will ensure that we play our part in this switch-over and that the eventual retirement of the copper networks is managed in a way that promotes sustained infrastructure investment from a range of organisations.

“With rollouts underway to reach over 20% of the UK market, our city-wide full fibre networks like that in Stirling will soon be of sufficient coverage to play their part, enabling a copper to fibre switch-over for the benefit of Communication Providers and their customers. Through our consultation, we look forward to engaging with the whole industry, including Openreach and BT Retail, to help develop a national plan to efficiently and smoothly upgrade Britain.”

With such a healthy independent infrastructure sector in the UK it seems clear some kind of best practice consensus is called for and it’s good to see someone try to get the ball rolling on that. Mesch will be speaking live at the Telecoms.com LIVE event in London on 7 November and this topic seems likely to come up. If you want to attend just click here to register.

Hyperoptic unveils UK expansion plans after raising £250mn

Full-fibre broadband provider Hyperoptic has unveiled plans to expand its services to an additional 50 towns and cities through the UK after it completed a debt raise of £250 million.

Claiming this is the largest single investment in the UK for a full-fibre optic network provider, companies like Openreach don’t fall into the full-fibre definition, the plan is to reach five million homes by 2025. Hyperoptic claims to currently have nearly half a million homes and businesses using its 1 Gbps broadband service.

“Such large financial backing from prestigious investors is testament to the strength of Hyperoptic’s business model and proven track record for delivery,” said CEO Dana Tobak. “All our teams are forging ahead with one rally cry: Let’s Gigabit Britain.”

“Hyperoptic has the vision, determination and means to lead the rollout of gigabit connectivity across this country, and smash the digital divide once and for all,” said Hyperoptic Chairman, Boris Ivanovic. “I am proud that we have led by results. This latest round of funding is a tremendous recognition of our achievement and provides the impetus for making Hyperoptic the premier full fibre national network.”

Hyperoptic was advised by LionTree Advisors and the deal was co-led by BNP Paribas and ING, with a funding club of eight Tier 1 banks; Royal Bank of Scotland, Societe General, Royal Bank of Canada, HSH Nordbank, NIBC, and Barclays. Last year the company also received £100 million in funding to accelerate the build of its full-fibre network.

The cash itself will be used to hire an additional 1500 employees, more than doubling its current 600 staff across five offices, with plans to recruit at least a further 400 employees by the end of this year and another 1,000 by the end of 2019. Over the last 12 months, Hyperoptic has expanded its network to 10 additional UK towns and cities, and signed contracts in a further 14, taking the total north of 50. These funds will also be used to meet these commitments.

Fibre connectivity in the UK has certainly been sluggish to date, Ofcom suggests less than 4% of UK homes are currently hooked up, though the progress of alt-nets such as Hyperoptic and CityFibre are certainly putting forward a challenge to the status quo. Openreach certainly has the scale, but it remains to be seen whether positive moves from challenger business provides the kick the incumbent so desperately needs.