Blackpool invests in multi million pound fibre broadband upgrade

A private and public co-operative group is working to roll out a multimillion pound fibre broadband upgrade which will see Blackpool become one of the UK’s best connected towns.

The technology will see the town’s old copper lines replaced with a ‘hyperfast’ fibre alternative, giving residents and businesses the opportunity to access gigabit speeds.

The launch of the Fibre Blackpool initiative is a result of ?3.1m of funding that was secured in Spring 2018 through the Department for Digital, Culture, Media and Sport (DCMS).

The grant has been used to expand a shared fibre infrastructure into Blackpool town centre and along the length of the coast’s tramline, from Squires Gate Lane and Blackpool Airport Enterprise Zone all the way to Fleetwood and Hillhouse Technology Enterprise Zone, thus future-proofing the town with a full ‘fibre to the premises’ (FTTP) connection.

SMEs and residents will be able to claim one-off vouchers to put towards the cost of connecting to the project.

Shaun Fensom,secretary of the Cooperative Network Infrastructure (CNI), said: ?Over the next two years we’ll be working with Blackpool to unlock a state-of-the-art fibre network for the benefit of both residents and businesses.

“The network will enable Internet service providers – members of our cooperative -to deliver some of the fastest internet connections available in the UK.They’ll be investing to connect businesses and residents along the Fylde Coast and in the two Enterprise Zones. That will mean faster, better connections, and bring yet more investment to Blackpool.”

Author? Tim Aldred

Virgin Media and O2 owners confirm ?31bn mega-merger in UK

The owners of Virgin Media and O2 have confirmed a ?31bn mergerdeal to create a new ?national champion” to challenge BT and Sky in the UK

Liberty Global, which owns the UK’s largestcable company Virgin, and Telef?nica, which owns Britain’s biggest mobileoperator O2, are to merge their UK operations in a new 50-50 joint venture.

Liberty Globalis also ITV’s biggest shareholder, with a 10% stake, and owns half ofAll3Media, the production group that makes shows including Liar, Fleabag andHollyoaks.

The newcompany, which will challenge BT and Sky by offering consumers competitivebundles of TV, mobile and broadband packages, will have 46 million customersand ?11bn in revenue.

Mike Fries, the chief executive of Liberty Global, said it hadbeen only ?a matter of time” until there was more convergence in the highlycompetitive UK media and telecoms market.

?BT and EEtogether are a powerful combination in our minds,” he said, referring to BT’s ?12.5bn deal to buy the mobile company in 2016.?Our rationale was that it was just a matter of time, convergence has beenslower in this market. With Virgin Media and O2 together, the future ofconvergence is here today.”

The new companywill invest ?10bn in areas including gigabit-speed broadband and 5G networks.

?The UK is one of the most attractive markets on Earth,” saidJos? Mar?a Alvarez-Pallete, the chief executive of Telef?nica. ?Evenconsidering Brexit, we have been investing heavily in the UK. It is the righttime to commit to the future of the UK by building this value proposition.”

Under the deal,which is expected to complete in the middle of next year, there is an option toperhaps float the venture on the UK stock market in three years.

?We are bothcoming to the joint venture with the expectation we will remain partners,”Alvarez-Pallete said. ?We don’t come into this with the expectation that wewill turn right or left at a certain point of time. If a listing were to come downthe road, it can provide a transparency of value and give people the chance toown part of a national champion.”

Philip Jansen,the chief executive of BT, said the emergence of a new power player in the UKmarket would not make BT speed up its own investment plans.

?We are not going to go any faster,” he said. ?We have acomprehensive five-year plan. This deal is not a surprise, I think the industryneeds consolidation. It follows our strategy four years ago [buying EE].Competition is good, it drives innovation.”

The new jointventure will be overseen by an eight-strong board of directors, four each fromLiberty Global and Telef?nica, with the chairman rotating every two yearsbetween the two companies. Liberty Global’s Fries will be the first chairman.

The deal willinclude recapitalisations under which Telefonica will receive ?5.7bn inproceeds and Liberty Global ?1.4bn. The new venture will be laden with ?18bn inlong-term debt.

Vodafone, whichhas previously held talks with Liberty Global about a similar UK tie-up, couldyet look to make a counter offer.

LIberty Global, Telefonica to merge Virgin Media, O2 into joint venture

When consummated, an event the two parties expect will take place by the middle of next year, the joint venture will serve more than 46 million video, broadband, and mobile subscribers and boast ?11 billion of revenue.

Author – Stephen Hardy May 2020

Liberty Global plc (NASDAQ: LBTYA, LBTYB and LBTYK) and Telefonica SA (Madrid stock exchange: TEF) have reached an agreement to merge their operations in the UK into a joint venture. The merger, valued at ?31.4 billion ($38 billion) will see the combination of Liberty’s Virgin Media cable MSO with Telefonica’s O2 mobile services provider. When consummated, an event the two parties expect will take place by the middle of next year, the joint venture will serve more than 46 million video, broadband, and mobile subscribers and boast ?11 billion ($13.6 billion) of revenue. The joint venture does not include Liberty Global’s operations in Ireland.

The joint venture, which doesn’t yet have a name, would pose a significant rival to British Telecom in the UK residential and business services markets. Liberty Global and Telefonica say the new entity will invest ?10 billion ($12.36 billion) in the UK over five years.

?Combining O2’s number one mobile business with Virgin Media’s superfast broadband network and entertainment services will be a game-changer in the U.K., at a time when demand for connectivity has never been greater or more critical,” commented Jose Maria Alvarez-Pallette, CEO of Telefonica. ?We are creating a strong competitor with significant scale and financial strength to invest in UK digital infrastructure and give millions of consumer, business, and public sector customers more choice and value. This is a proud and exciting moment for our organizations, as we create a leading integrated communications provider in the UK.”

?We couldn’t be more excited about this combination,” added Mike Fries, CEO of Liberty Global. ?Virgin Media has redefined broadband and entertainment in the U.K. with lightning fast speeds and the most innovative video platform. And O2 is widely recognized as the most reliable and admired mobile operator in the U.K., always putting the customer first. With Virgin Media and O2 together, the future of convergence is here today. We’ve seen the benefit of FMC first-hand in Belgium and the Netherlands. When the power of 5G meets 1 gig broadband, U.K. consumers and businesses will never look back. We’re committed to this market and are right behind the Government’s digital and connectivity goals.”

The board of the joint venture will have eight members, four from each of the two participating companies. Fries and Alvarez-Pallette will be among the board members. The post of board chairman will be held for alternating two-year periods by someone from each company, with a Liberty Global executive holding the position first.

The deal involves a somewhat complicated recapitalization scheme involving multiple financings that will leave the joint venture a target closing net leverage ratio of 5.0X, or approximately ?18 billion ($22.25 billion) of long-term debt. Net new proceeds from the recapitalizations are expected to be approximately ?6 billion. With the recapitalizations, Telefonica expects to receive ?5.7 billion in total proceeds and Liberty Global ?1.4 billion ($1.73 billion), including approximately ?800 million from the recapitalization of its Virgin Media Ireland business. As part of the deal, a syndicate of banks has underwritten a ?4 billion standalone undrawn financing on the O2 business.

The transaction also includes equalization payments, based upon the enterprise value of each business involved in the joint venture. Within this context Liberty Global will make a cash payment to Telefonica of ?2.5 billion ($3.1 billion). Liberty Global expects this payment will be offset by funds from the recapitalizations, which will result in the Liberty Global netting cash from the deal.

The two parties expect the joint venture generate estimated run-rate cost, capex, and revenue synergies of ?540 million ($667.63 million) on an annual basis by the fifth full year after closing. Approximately ?430 million ($531.63 million) of this total would come from cost and capex synergies, say Liberty Global and Telefonica.

The transaction is subject to regulatory approval and the completion of the recapitalizations, but not shareholder approval.

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