The fibre firm founded by entrepreneur and philanthropist Neil McArthur is merging with another provider with ambitious plans for growth.
Freedom Fibre is joining forces with InfraBridge-backed VX UK Holdings in what Mr McArthur calls a “strategic merger”.
The combined business will serve more than 285,000 premises, mostly in the North West and Midlands. Freedom Fibre will acquire the UK assets and operations of VX UK and the combined entity will be controlled by infrastructure investment manager InfraBridge.
The new business will operate as Freedom Fibre and be run by Mr McArthur. Darren Woods, currently Freedom Fibre chief financial officer, will have the same role in the enlarged business.
Freedom Fibre launched in 2020 to offer wholesale-only services on its network and has a long-term wholesale agreement with TalkTalk.
Its founder Mr McArthur founded Opal Telecommunications in 1995. It was acquired by Carphone Warehouse in 2002, when Talk Talk was formed. Mr McArthur has also actively invested in charity and regeneration projects in his home town of Irlam.
TalkTalk has been a minority shareholder in Freedom Fibre since 2021 and will remain a shareholder in the combined business. Fund manager Equitix is also backing Freedom Fibre.
VX UK has a strong presence in Stoke on Trent and the surrounding areas through its contract with Stoke City Council to provide connectivity for local authority premises. VX UK markets its broadband service to consumers through its LilaConnect brand, alongside a wholesale offering for local ISPs. VX also has fibre assets in Bristol and Colchester. VX UK’s Swedish parent company, VNEXT AB, remains managed by InfraBridge.
Damian Stanley, managing partner at InfraBridge, said: “The combination of VX UK and Freedom Fibre, with the backing of our shareholders, brings together two of the UK’s leading altnets into a new, stronger company. Our businesses are highly complementary, including our geographic proximity, the quality of our network build and our retail and wholesale go-to-market strategies, and we now have a platform with the support of TalkTalk to provide ongoing connections across the enlarged business.”
Neil McArthur, CEO at Freedom Fibre, said: “This is a strategic merger which leverages the strengths of both Freedom Fibre and VX UK to create a larger, stronger and more diverse business backed by two significant investors with ambitions for growth. We are delighted to be joining forces with the VX team and are hugely excited about the future potential of this newly combined business.”
Achal Bhuwania, CIO, Equitix, said: “Scale and resources are both critical factors needed to successfully commercialise a UK altnet. This merger of Freedom Fibre and VX UK will contribute significantly to these two critical factors, accelerating the growth of the combined businesses creating a larger network with both a wholesale and retail network offering for our growing customer base.”
The transaction is set to close at the end of Q1, subject to regulatory approval.
VX UK was advised by Houlihan Lokey; Freedom Fibre was advised by Cameron Barney. Weil and Ashurst provided legal advice to InfraBridge and Freedom Fibre respectively.
