Liberty Global and Telefonica Infra, and Infravia Capital, specializing in investments in infrastructure and technology, have reached an agreement to form a new joint venture that will deploy Fiber to the Home (FTTH) in the United Kingdom. From 2022 to 2026, the new company will initially roll out fiber to 5 million homes, which is not currently accessed by Virgin Media’s O2 network, and is likely to expand to 2 million homes. Liberty Global and Telefonica will hold a combined 50% stake in the new company through a holding company, while the remaining 50% will be held by Infravia.

The deal will accelerate the rollout of FTTH in the UK with an investment of approximately £4.5bn (€5,357m), backed by £3.3bn (€3,929m) of fully subscribed funding commitments and up to £1,400 million sterling (1,666) million euros) of capital commitments.

As noted in a joint statement, Fiber Networks will offer FTTH wholesale access to telecommunications service providers, and core customers through an agreement with the joint venture at the conclusion of the Virgin Media O2 (“VMO2”) deal. will act as transactions. The deal, along with Vision Media O2’s own investment in fiber to upgrade its existing network of 16 million locations, will increase the UK company’s gigabit footprint to around 80% of the UK once the deal is completed.

The United Kingdom is a growing market for Telefónica, explained its president Jose María lvarez-Pallet. “The deal will accelerate access to the next generation of broadband connectivity for more UK homes thus adding to Telefónica Infra’s growing portfolio. Our infrastructure subsidiary can now add the UK to its list of countries with these FTTP vehicles. InfraVia joins the first level institutions associated with Telefónica’s operational units in relevant markets such as the United Kingdom, Spain, Germany or Brazil”, he highlighted.

The transaction is subject to customary closing conditions, including regulatory approval, and is expected to close in the fourth quarter of 2022. Liberty Global and Telefonica have been mentored by Barclays and Liontree, as well as Allen & Owery. InfraVia Capital Partners is advised by Lazard, as well as Linklaters and De Pardieu Brocas Maffei.