InfraVia, Liberty Global and Telefónica agreed to acquire Substantial Group for an enterprise value of £2 billion through their joint venture, nexfibre. The deal is expected to close by Q3 2026, subject to regulatory approvals, and is projected to unlock £3.5 billion in investment in the UK market between 2026 and 2040.
Substantial Group, founded in 2019 and backed by Advencap, DigitalBridge and Soho Square Capital, operates the Netomnia wholesale fibre network and serves roughly 450,000 retail customers. Its footprint is expected to exceed 3.4 million premises and 500,000 customers by completion. Combining nexfibre’s existing footprint with Netomnia and upgrading 2.1 million adjacent Virgin Media O2 HFC homes to fibre will create a wholesale challenger to BT Openreach with around 8 million premises by the end of 2027. When paired with the expanding fibre footprint of Virgin Media O2, the networks will collectively reach about 20 million UK premises.
InfraVia will contribute £850 million in new funding, while Liberty Global and Telefónica will jointly add £150 million. nexfibre will sell Substantial Group’s retail brands, including YouFibre and Brsk, to Virgin Media O2 for £150 million. In exchange for committing wholesale traffic across 4.6 million overlapping and adjacent homes, Virgin Media O2 will receive approximately £1.1 billion in cash and an indirect 15% stake in nexfibre. Virgin Media O2 will also provide managed services, including construction, under ongoing service agreements.
- £2 billion enterprise value for Substantial Group
- ~3 million current premises (Netomnia), rising to >3.4 million by closing
- ~450,000 current customers, expected to exceed 500,000
- 2.1 million Virgin Media O2 HFC homes to be upgraded to fibre
- 8 million nexfibre premises targeted by end-2027
- 20 million combined premises when including Virgin Media O2 footprint
- £1 billion in new net funding for nexfibre (£850m InfraVia; £150m Liberty Global/Telefónica)
- £1.1 billion cash plus 15% indirect nexfibre stake to Virgin Media O2 tied to wholesale commitment
- Transaction expected to complete by Q3 2026
“By bringing our strengths together, we are creating a scaled and financially secure wholesale fibre challenger to BT Openreach – one that will enhance competition, strengthen the UK’s digital infrastructure and deliver greater choice and quality for consumers and businesses,” said Vincent Levita, Mike Fries and Marc Murtra in a joint statement.
🌐 Analysis: The UK’s FTTH market has entered a phase of consolidation after several years of aggressive overbuild by alternative network providers. Openreach, the network division of BT Group, recently reported that its full-fibre network now passes more than 15 million premises, with a target of 25 million by the end of 2026. In its latest financial report, BT highlighted continued fibre build momentum alongside rising customer take-up, with FTTP connections surpassing 5 million and penetration continuing to climb as copper customers migrate to fibre. The company also reiterated its long-term ambition to reach up to 30 million premises by the end of the decade, subject to capital allocation and regulatory conditions.
At the same time, many altnets face pressure from slower customer growth, higher financing costs, and increasing competition in overlapping urban markets. The nexfibre–Substantial Group transaction reflects a broader shift toward scaled wholesale platforms capable of supporting multi-billion-pound capital expenditure programs and sustaining competitive pressure on Openreach. As the market matures, financial resilience, network scale, and wholesale access models are becoming decisive factors in the next phase of UK fibre deployment.
