Britain’s competition regulator has raised significant concerns over Nexfibre’s proposed £2 billion acquisition of fibre broadband operator Netomnia, saying the transaction could substantially reduce competition in the UK’s rapidly developing full-fibre market.
The Competition and Markets Authority, or CMA, said on October 2 that it believes another potential outcome — an acquisition of Netomnia by CityFibre — could have produced a stronger competitor to the country’s largest broadband infrastructure networks. Reuters
What Is the Nexfibre-Netomnia Deal?
Nexfibre agreed in February to acquire the owner of Netomnia for approximately £2 billion, or $2.7 billion.
Nexfibre is a joint venture backed by Liberty Global, Telefónica and InfraVia Capital Partners.
Netomnia operates what Reuters describes as Britain’s second-largest alternative fibre network, making the transaction potentially important for the future structure of the UK broadband market. Reuters
Why the CMA Is Concerned
The CMA’s concern centres on competition.
Britain has been investing heavily in replacing older broadband infrastructure with faster full-fibre networks. Several alternative network operators, often called “altnets”, have been competing with established infrastructure providers.
The regulator believes the Nexfibre-Netomnia combination could remove competitive pressure that might otherwise have developed between major fibre-network operators.
According to the CMA, CityFibre would most likely have acquired Netomnia if Nexfibre had not reached its agreement. Reuters
CMA Says CityFibre Deal Could Have Created Stronger Rival
This is one of the most significant elements of the regulator’s assessment.
The CMA said a combination between CityFibre and Netomnia could have created a stronger challenger to both BT’s Openreach network and an enlarged Nexfibre/Virgin Media O2 operation.
CityFibre could potentially have provided wholesale access to Netomnia’s network to existing customers including Sky and Vodafone. Reuters
That alternative market structure forms an important part of the CMA’s competition concerns.
Nexfibre Disagrees With the Regulator
Nexfibre has pushed back against the CMA’s assessment.
CEO Rajiv Datta told Reuters that the regulator’s findings did not reflect the reality of Britain’s fibre market.
Nexfibre argues that the transaction would support the investment and scale required to create a sustainable challenger to Openreach. Reuters
The disagreement means the regulatory process is far from settled.
Network Could Reach 8 Million Premises
The scale of the proposed combined network helps explain why regulators are examining the transaction closely.
The acquisition would add more than 3.4 million premises and over 500,000 customers to Nexfibre’s footprint.
Nexfibre expects that could take its overall reach to approximately 8 million premises by the end of 2027. Reuters
Combined with Virgin Media O2, the wider group could eventually have access to around 20 million premises.
Reuters reports that BT’s Openreach network currently provides a useful comparison, with a footprint of approximately 25 million premises. Reuters
Why Broadband Competition Matters to Consumers
Competition between fibre networks can affect far more than the companies involved in a takeover.
Strong infrastructure competition can influence broadband pricing, network expansion, service quality and the speed at which faster connections become available.
Internet service providers can also benefit when they have several wholesale networks from which to purchase access.
The CMA therefore has to consider whether consolidation creates efficiencies and investment benefits without weakening competition enough to harm consumers over the longer term.
The UK Fibre Market Is Consolidating
Britain’s fibre rollout produced numerous alternative networks during the investment boom in high-speed broadband.
Building fibre infrastructure, however, requires substantial capital.
As networks expand, operators face pressure to gain enough customers to justify the cost of laying fibre across millions of homes and businesses.
That economic reality has encouraged consolidation across the industry.
The Nexfibre-Netomnia transaction is therefore part of a broader question facing the UK telecom market: how many large infrastructure networks can operate sustainably while still maintaining effective competition?
CityFibre Wants the Deal Blocked
CityFibre has taken a stronger position.
The company, which had reportedly made an offer for Netomnia, argues that Nexfibre’s acquisition would significantly reduce competition.
Following the CMA’s findings, CityFibre called on the regulator to prevent the transaction from proceeding. Reuters
Whether the CMA ultimately reaches that conclusion will depend on the remaining regulatory process and any remedies offered by the companies.
October 16 Is the Next Important Deadline
Nexfibre now has an opportunity to respond.
The company can submit proposed remedies addressing the CMA’s concerns by October 16, 2026. Reuters
Remedies in competition investigations can sometimes involve structural changes, commercial commitments or other measures designed to preserve competition.
Nexfibre has not yet confirmed what action it will take. Datta said the company would consider the CMA report before deciding its next steps. Reuters
Final CMA Decision Expected in December
The next major milestone is December 15, 2026, when the CMA is expected to make its final decision. Reuters
There is also a possibility that the companies could reconsider the transaction before then.
Enders Analysis analyst Karen Egan told Reuters that the deal could potentially be abandoned before the final ruling unless the parties believe there remains a realistic route to approval. Reuters
For now, however, the acquisition remains under regulatory review.
What Happens Next?
Three developments will be particularly important.
First, investors and the broadband industry will watch whether Nexfibre submits remedies before October 16.
Second, the CMA will have to determine whether those measures sufficiently address its competition concerns.
Finally, the regulator’s December decision could have wider implications for consolidation among Britain’s alternative fibre networks.
Whatever the outcome, the case demonstrates how strategically important broadband infrastructure has become as Britain continues its transition towards full-fibre connectivity.
Bottom line: The UK CMA has warned that Nexfibre’s proposed £2 billion ($2.7 billion) acquisition of Netomnia could substantially reduce competition in Britain’s fibre-broadband market. Nexfibre can propose remedies by October 16, with the regulator’s final decision expected on December 15, 2026.
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