Ian Georgeson

CityFibre continues UK full-fibre roll-out to Teesside, Norwich as it closes £1.125bn funding round

After announcing two new deployments in a matter of hours, CityFibre has gained what it says is the largest ever capital raise for UK full-fibre deployment

Hot on the heels of obtaining what it said was the largest ever capital raise for UK full-fibre deployment, CityFibre has unveiled two new deployments in the traditionally underserved East and North East of the country.

Over the past two years, the company has transformed itself from an altnet into the UK’s third-largest comms infrastructure provider, and CityFibre gigabit broadband services are now live in 46 locations across the country. The two latest additions are in Norwich and Teesside.

Construction of the £50m Norwich-wide full-fibre network has now started in the Catton Grove area and is being delivered by Telec Networks on behalf of CityFibre. The first streets include those in and around Bullard Road, Woodcock Road, Palmer Road, Jewson Road, Aylsham Road and Weston Road.

The team will use a range of construction methods while working in close partnership with Norwich City Council and Norfolk County Council. The overall project is expected to take about three years to complete and Norwich services will be available from an increasing range of broadband providers, including Air Broadband, InTouch Systems and Giganet.

Meanwhile, up the east coast of England, CityFibre is working with local build partner MAP Group to support staff and patients at Teesside Hospice, donating wireless access points to boost coverage and overcome poor-quality signal struggles.

Teesside Hospice, in Middlesbrough, provides essential care for people and families who are living with a terminal illness. Its expert medical, nursing and allied health professional team offers pain and symptom control, psychological support as well as end-of-life care for thousands of local people every year.

With poor signal quality at the hospice causing disruption to key processes, including logging medical records and internal communications, as well as limiting the online experience for patients, the donation will give all internet users access to better connectivity ahead of CityFibre’s full-fibre roll-out reaching the Hospice’s area. Teesside Hospice is in the planned build area for CityFibre’s full-fibre roll-out, so will soon have the option of switching to full-fibre-enabled services.

Construction of CityFibre’s £42m network formally began in May and, upon completion, it will be in reach of nearly every home and business in Middlesbrough.

The latest roll-outs are part of CityFibre’s plan to cover one-third of the UK market by 2025, bringing full-fibre to up to eight million homes. This plan will be supported and accelerated by the new £1.125bn capital raise, comprising £825m in equity and £300m in bank extension.

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The capital includes new equity investments from Abu Dhabi’s Mubadala Investment Company, one of the world’s leading sovereign investors, and Interogo Holding, a foundation-owned investment group. The two firms will join CityFibre’s existing investors, Antin Infrastructure Partners and the infrastructure business within Goldman Sachs Asset Management, as minority shareholders.

“This capital raise is proof of the benefits of a truly competitive infrastructure market,” said CityFibre CEO Greg Mesch. “If nurtured and protected, infrastructure competition at scale will continue to unleash huge investment from the private sector as well as catalyse investment from incumbent operators. Ultimately, though, it is residents, businesses and the UK economy that stand to benefit, with competition driving what has become the fastest roll-out of full-fibre in Europe.”

Mubadala’s investment into CityFibre also marks the first capital deployed under the new infrastructure vertical of the United Arab Emirates (UAE) – UK Sovereign Investment Partnership. The partnership, which Mubadala oversees for the UAE and the Office for Investment for the UK, serves as a coordination platform to grow a future-focused investment relationship between the two nations and enable growth, employment and global competitiveness across priority sectors. 

The £300m extension of CityFibre’s existing £820m banking facilities with Crédit Agricole CIB sees National Australia Bank joining other major global financial institutions.

Waleed Al Mokarrab Al Muhairi, Mubadala’s deputy group chief executive, said: “Digital infrastructure is a vital enabler of social and economic progress, and a priority growth sector for Mubadala, so we are delighted to be the lead investor in a fund-raise which is accelerating the roll-out of world-class digital infrastructure for one-third of the UK.

“Mubadala's investment in CityFibre is consistent with our mandate to deliver sustainable financial returns. As the first investment under the infrastructure vertical of the UAE UK Sovereign Investment Partnership, it exemplifies the partnership’s mandate to guide high-impact investment to enable future-focused economic growth.”

Going forward, CityFibre is exploring opportunities to participate in Building Digital UK’s (BDUK) Project Gigabit rural programme. As the fibre network has been built out, CityFibre has secured long-term volume commitments from Vodafone, TalkTalk and Zen, as well as mobile operator Three UK.

Work to integrate and enable internet service providers (ISPs) over CityFibre’s full national footprint is under way. CityFibre currently supports 24 smaller regional consumer ISPs dedicated to full-fibre broadband services, alongside over 1,800 business ISPs and resellers.

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