CityFibre Buys KCOM for UK National Network Footprint

December 14, 2015
Author Stephen Hardy
Editorial Director and Associate Publisher

UK fiber-optic network services provider CityFibre says it has acquired the national fiber-optic network infrastructure and ductwork of KCOM for £90 million ($136 million). A new funding round of £180 million helped pay for the deal, which the company says will position it to compete with BT's Openreach fiber-optic network services subsidiary.

CityFibre says the acquisition of KCOM's infrastructure (excluding networks in Hull and East Yorkshire) will extend its UK footprint by more than 300%. The physical infrastructure assets comprise 1,100 km of duct and fiber network in 24 UK cities, as well as 1,100 km of national long-distance infrastructure that connects these cities to major data centers across the UK, including Internet peering points in London. The addition of KCOM's assets will increase CityFibre's serviceable metro markets to 36 cities, with a goal of reaching 50 cities by 2020. This would equate to 20% of the UK market, CityFibre asserts.

The deal also will connect CityFibre's network to more than 7,000 mobile cell sites, 24,500 public sector sites, and 245,000 businesses. The company also will strengthen its hand in fiber to the home (FTTH) based broadband service provision, enabling CityFibre to pass 3.5 million homes.

In all, the service provider says the combined infrastructure will put it second behind BT in terms of national reach, making it a viable alternative to Openreach.

CityFibre expects its new financing and the KCOM acquisition to close in the middle of January 2016. The new financing comprises £80 million of new equity and £100 million in debt facilities.