Two prominent alternative network providers in the UK broadband sector are on the verge of finalising a significant merger, a move that could reshape the competitive landscape as financial pressures mount across the industry.
Advanced Talks Between Freedom Fibre and Truespeed
Sky News has learned that Freedom Fibre and Truespeed are engaged in advanced discussions regarding a potential tie-up. While sources caution that negotiations could still collapse, insiders suggest a deal might be struck within days, marking a pivotal moment for both companies.
This potential merger comes at a critical time for the altnet sector, which is grappling with billions of pounds in debt and an increasing risk of insolvencies. Consolidation is seen as a strategic response to these challenges, allowing firms to scale operations and improve financial stability.
Financial Backing and Operational Footprints
Truespeed, which has secured £175 million in funding from Aviva Investors, a division of the FTSE-100 insurer Aviva, primarily operates in the west of England. Its network serves areas such as Bath, Somerset, and south Gloucestershire, having connected approximately 28,000 customers as of last summer.
In a previous consolidation move, Truespeed merged with County Broadband in 2025, creating an operator that covers more than 175,000 homes, with a focus on East Anglia. This expansion laid the groundwork for further growth through additional mergers.
Freedom Fibre, launched in 2020, has established a strong presence in Cheshire and Greater Manchester. In late 2023, it agreed to merge with VX UK Holdings, resulting in a combined business that passes over 285,000 premises. The company is backed by blue-chip infrastructure investors, including Equitix and InfraBridge, part of the New York-listed DigitalBridge Group.
Impact of the Proposed Merger
If completed, the merger between Freedom Fibre and Truespeed would create a formidable group with access to more than 400,000 premises, according to industry analysts. This would position the combined entity as one of the largest players in the altnet space, behind giants like BT Group's Openreach and CityFibre.
The consolidation trend is driven by the need for altnets to secure new financing to fulfil their expansion plans. Many have struggled to raise the necessary funds independently, leading to a wave of sales and mergers in recent months.
Broader Industry Context and Challenges
The financial strains in the sector are evident from the plight of other companies. For instance, G.Network, which focused on central London and raised hundreds of millions in debt and equity, was sold to distressed debt fund Fitzwalter Capital and is expected to be resold soon.
Similarly, Gigaclear, in which Equitix holds a stake, is reportedly set to be taken over by its lenders after a failed sale process, as reported by the Financial Times last week. These examples underscore the precarious financial environment facing many altnets.
In contrast, CityFibre, the largest player behind Openreach, completed a £2.3 billion refinancing last year, positioning it well to lead further industry consolidation. This move highlights the divergent paths within the sector, with some firms strengthening their positions while others face significant hurdles.
Investor Perspectives and Future Outlook
Spokespeople for Aviva Investors and Equitix have declined to comment on the ongoing talks between Freedom Fibre and Truespeed. However, their involvement signals confidence in the potential of a merged entity to navigate the competitive and financial challenges ahead.
The outcome of these negotiations could set a precedent for future mergers in the UK broadband market, as altnets seek to build scale and resilience in an increasingly crowded and debt-laden industry.
