Virgin Media O2 owners to buy Netomnia parent in £2bn deal

Virgin Media O2's owners have agreed a deal to buy the parent company of Netomnia, the UK's second-largest alternative fibre network after CityFibre, for around £2 billion.

The acquisition is intended to create a scaled wholesale network positioned to compete more directly with BT Openreach.

It comes amid a wider period of consolidation across Britain's full-fibre market as operators seek scale and long-term financial sustainability.

Illustration: Choose.co.uk

Netomnia deal reshapes fibre ownership

Liberty Global and Telefonica, the joint owners of Virgin Media O2, together with infrastructure investor InfraVia Capital Partners, have agreed to acquire Substantial Group, the parent company of Netomnia and retail ISP YouFibre, in a deal valued at around £2 billion.

Netomnia's full-fibre network currently covers around 3 million premises and serves approximately 460,000 customers, making it the UK's second-largest alternative fibre operator after CityFibre.

The transaction will see Netomnia's infrastructure integrated into nexfibre, which operates as a wholesale-only network platform, while Virgin Media O2 will separately acquire the YouFibre retail business.

Combined with nexfibre's existing build and planned expansion, the enlarged wholesale platform is expected to reach around 8 million premises by the end of 2027.

The companies said the deal is intended to create a scaled wholesale fibre platform positioned to compete more directly with BT Openreach, bringing together network assets and long-term investment backing under a single structure.

Under the terms of the agreement, Virgin Media O2 will receive approximately £1.1 billion in cash and an indirect 15% stake in nexfibre in exchange for committing to use the network at scale over the long term, formalising its role as a major customer as it expands.

Completion of the deal remains subject to regulatory approval.

What this means for YouFibre customers

For customers of Netomnia-based providers, the companies say services will continue as normal following completion of the deal. Substantial Group CEO Jeremy Chelot said the YouFibre brand will remain post-close, adding that customers would continue to receive "the same trusted service they know today."

Netomnia had already begun merging its two retail providers prior to the transaction, with Brsk customers now being notified that services will transition to the YouFibre brand as part of a phased rollout through 2026. The companies say contracts, pricing and service will remain unchanged during that process.

The transaction therefore changes ownership behind the infrastructure and retail operations rather than the services customers currently receive, with any longer-term branding or product decisions set to be determined by Virgin Media O2 once the acquisition completes.

Virgin Media O2 does not currently operate multiple consumer broadband brands in the UK market, and previous ISP acquisitions have often resulted in unified branding over time rather than parallel retail identities, although no such plans have been announced in this case.

A scaled challenger to Openreach

The transaction adds further momentum to a consolidation phase that has been building across the UK's full-fibre market over the past few years.

Netomnia is the second-largest alternative fibre network after CityFibre, and both operators have expanded partly through acquisition as well as organic build. As rollout costs rise and investor expectations tighten, scale has increasingly become central to long-term viability.

By folding Netomnia into nexfibre and aligning Virgin Media O2 more closely with the wholesale platform, the deal strengthens the structure of a rival infrastructure model to BT Openreach - one built around a ring-fenced network backed by external capital and a committed retail anchor tenant.

Rather than proceeding with its earlier plan to spin off its own network into a broadly open wholesale platform, Virgin Media O2 is now backing a single scaled infrastructure vehicle in nexfibre, in which it holds a stake, while retaining retail control of its existing footprint. In structural terms, that consolidates scale within a commercially aligned platform rather than dispersing it across multiple wholesale relationships.

Virgin Media O2's own network footprint combined with the expanded nexfibre platform would reach up to around 20 million premises across the UK, creating one of the largest alternative infrastructures outside Openreach.

The distinction matters. Openreach operates as a structurally separated wholesale network serving many retail providers, while the nexfibre model is anchored around a dominant retail partner whose incentives are now more directly aligned with the network's expansion. As the fibre market matures, that alignment of capital, infrastructure and demand may prove more significant than simple footprint growth alone.