Oaktree reportedly investing £100m in UK fibre broadband

News

The US fund is apparently looking to buy a majority stake in altnet provider Zzoomm.

The Financial Times [subscription needed] Oaktree Capital Management has reached agreement to pay £100 million (€109.53 million) for a majority stake in the alternative fibre network provider.

Zzoomm will use the money to build out fibre in more British towns. So far, it has deployed a fibre network in the posh, ancient town of Henley-on-Thames (pictured) in Oxfordshire.

The report says that although this is one of Oaktree’s first direct ventures into telecoms, last year Canadian fund Canada’s Brookfield Asset Management bought a majority stake in Oaktree. Brooke has investments in towers, data centres and some smaller operators.

Attracting big money

Larger funds are increasingly investing in fibre infrastructure in the UK. Goldmann Sachs’ infrastructure fund and Antin Infrastructure partners acquired CityFibre in 2017. It plans to spend £4 billion deploying fibre in 100 British locations.

KKR acquired urban fibre company Hyperoptic in 2019  and in summer, Warburg Pincus and Deutsche Telekom’s investment fund inked a £400 million plan to expand London-based telecoms company Community Fibre’s footprint to a million homes.

Small beginnings

Telecoms veteran Matthew Hare founded Zzoomm a decade after launching Gigaclear to bring broadband to rural areas.

Deploying broadband in small, historic market towns like Henley is far from easy due to their narrow, cobbled streets, listed buildings and relatively low populations. So far there is no information about possible future locations for Zzoomm’s activities.