The UK Competition and Markets Authority (CMA) has announced it will fast-track its review into Nexfibre's proposed £2 billion acquisition of Substantial Group, which operates the Netomnia brand. The decision accelerates the process toward a potential in-depth phase two investigation, with the CMA set to confirm whether it will proceed by August 26.
Deal Details and Market Impact
Nexfibre, a joint venture owned by Liberty Global, Telefonica, and private equity firm InfraVia, struck the deal in February to acquire the alternative fibre network provider. Upon completion, the combined entity is expected to cover more than 3.4 million fibre premises and serve over 500,000 customers. The companies have stated that the merger will strengthen their position against BT's Openreach, the UK's largest fibre broadband operator.
Competition Concerns and Fast-Track Request
Competitors have raised concerns that the deal could reduce competition in the broadband market. In response, Nexfibre requested a fast-tracked process last month to expedite the regulatory review. Rajiv Datta, chief executive of Nexfibre, said: “We requested a fast-track to phase two to get to the right answer faster; ensuring due process, while recognising urgency. We look forward to continuing our constructive engagement with the CMA. This deal would create the scaled, sustainable alternative to the BT Openreach monopoly, something the UK market still lacks. Every day of delay reinforces the incumbent’s advantage and slows the progress of genuine competition.”
Criticism from Rivals
However, alternative fibre competitors have argued that the takeover could harm consumers. Simon Holden, chief executive of CityFibre, stated: “Virgin Media O2/Nexfibre’s planned acquisition of Netomnia would remove a successful challenger and reduce choice for consumers. With 80% overlap between the two networks, the deal raises significant questions and the CMA is right to take an in-depth look at its impact on UK digital infrastructure and the competition that policymakers, regulators and the altnets are working so hard to establish.”
Next Steps
The CMA will now assess whether to launch a full phase two investigation, which would involve a more detailed examination of the merger's competitive effects. The deadline for this decision is August 26. The fast-track process aims to provide clarity more quickly for all parties involved, balancing the need for due process with the urgency of the deal.
