UK CMA investigation into Nexfibre acquisition of Netomnia

The UK Competition and Markets Authority (CMA) has raised competition concerns regarding Nexfibre’s proposed £2 billion acquisition of fiber optic operator Netomnia. The regulator issued provisional findings suggesting the deal could substantially reduce competition in the UK’s wholesale fixed broadband market, particularly in areas where the two networks overlap.

Nexfibre, a joint venture involving Telefónica, Liberty Global, and InfraVia Capital Partners, argues that the merger is necessary to create a financially robust challenger to BT’s Openreach monopoly and to facilitate a planned £3.5 billion investment in the UK. Shareholders have warned that blocking the deal might signal that the UK is “closing its doors to international investment.”

In its interim findings, the CMA noted that the merger could limit choice for broadband providers and impact competitive pricing. The regulator suggested an alternative scenario where CityFibre acquires Netomnia to maintain three major competing infrastructure providers: Openreach, Nexfibre, and CityFibre. The parties have been invited to submit plans to address these competition concerns before a final decision is reached.