Macquarie Hires Advisors to Prep Hull UK Broadband Operator KCOM for Sale
A new report claims that Australian investment group Macquarie has hired business advisors at Perella Weinberg Partners (PWP) to prepare KCOM for sale in Q2 2026. The operator is the incumbent broadband and phone provider for Hull, although their Fibre-to-the-Premises (FTTP) network also extends into other parts of East Yorkshire and Lincolnshire.
Just to recap. Macquarie Infrastructure (MIRA / MEIF 6 Fibre), following a fierce bidding war with the Universities Superannuation Scheme (USS), finalised their £627m acquisition of KCOM in August 2019 (here). At the time, the operator had only just finished their £85m “Lightstream” roll-out of full fibre technology in Hull (here), but they’ve since expanded this and also been busy removing their legacy copper line network and services.
Regular readers might recall that Macquarie reportedly kicked off a Strategic Review of the business back in the Spring of 2024, which was conducted by PJT Partners (here). Back then it was suggested that this could potentially result in either a sale or merger of the business, which somewhat reflects the same trend toward network consolidation as we’ve seen elsewhere in the market (usually driven by competitive pressures, rising build costs and high interest rates etc.). But until now there have been no new updates.
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According to HullLive, Macquarie has allegedly now taken another step toward consolidation by appointing New York based Perella Weinberg Partners to test the UK market for interest in a sale of KCOM’s business, which could take place as soon as the second quarter of this year.
The challenge this time is that KCOM’s control of its core market, particularly in Hull, has been significantly eroded in recent years by rival networks. According to Ofcom, recent builds by rivals like MS3, Connexin (CityFibre) and Grain have given local customers more choice of broadband connectivity, with around 70-79% of premises in the Hull Area now having access to at least one alternative network to KCOM.
The regulator’s recent telecoms market review of the Hull area also looks set to maintain many of its controls on the incumbent and even foster greater infrastructure sharing (here), which certainly won’t do KCOM any favours in terms of a potential sale of the business. Ofcom are due to publish their final proposals on all this in October 2026. KCOM has declined to comment on the news.
Mark is a professional technology writer, IT consultant and computer engineer from Dorset (England), he also founded ISPreview in 1999 and enjoys analysing the latest telecoms and broadband developments. Find me on X (Twitter), Mastodon, Facebook, BlueSky, Threads.net and Linkedin.
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I wonder if BT would be interested in acquiring KCOM.
It is the only area of the UK that never consolidated to become part of Post Office Telecommunications, that of course eventually became the BT/Openreach that we know today.
can never say never, but it’s not that big of a service area and they’d face integration hassles in trying to turn it into Openreach’s network. The money could arguably be better spent on the other 99% of the country.
There’d also be some overlap, as IIRC KCOM expanded their network outside of that traditional monopoly service area?
Ofcom/CMA may also have competition concerns, though it does remove a headache for them as there’d then be only one SMP telco to worry about (until Ofcom finally recognises that some of their competitors likely now qualify).
Hope they’re leaving it in a better state than they left Thames Water.
Those were my thoughts too.
This will be interesting as who wants to buy it with all the regulations that go with it . With Hull having MS3 and City Fibre as the article mentions. KCOM has always had its own way as they were the only provider in Hull . Virgin Media looked at when it was put up for sale and walked away when it was leaked . So who wants to buy it how much is fibre to the home and what percentage is still on copper and needs to be upgraded will this affect the price ? Would another altnet take it on that doesn’t have a footprint in the Hull region
Everything is fibre not aware of anything been left on copper, they are now in the process of recovering the copper to offset the deployment of installing fibre which has always been the plan.
This was reported in the Times newspaper last week , and who would want to buy ?
Virgin Media
BT Group
Another Investment Bank
A Continental Telecoms Firm with a background in this (Deutsche Telecom for example)
A ready built fibre network with a strong penetration level and as such money coming in is not an unattractive option. They just need to stay competitive against the likes of City Fibre / Connexin and MS3 to avoid churn!
KCOM pricing takes advantage of its old market position of being an effective monopoly. In contract price rises and cancellation charges when moving off-net are ridiculous in this day and age. They also need to think about a proper wholesale offering, although the AltNets have stolen a march on this so KCOM will be behind the curve.
Fix these things and stay ahead of the game and they are an attractive proposition!
2026 the year of consolidation / administrations
Do wonder re Toob tbh
This comes just days after Macquarie took full control of “Last Mile Infrastructure”.
Kcon is a total rip off merchants it’s service is unreliable and abolished it should merge with OPENREACH and vanish from the telephone ☎️ market it’s been a Parasite for 111 years not letting POST OFFICE TELECOMMUNICATIONS enter Hull now BT who are the GPO will finish them off
As you have been telling them Colin every day you have called their call centre for the past 20 years.
The overhead FTTH offering from KCOM, although covering the entire network, is fed entirely by pole mounted splice closures. This means that, unlike the vast majority of the country, every overhead feed needs to be run and spliced rather than simply plugging in to a CBT. This takes considerably longer and requires an engineer with the skills and equipment to splice from a ladder around 3m up a pole after running the dropwire down the pole.
This is a legacy from the initial build as they rushed to be the “first” to be a full fibre network and somewhat short sighted as moving forward, not only does it cause considerable issues with maintenance (ever tried splicing up a pole in wind or rain?), but simple pole replacements can easily now turn in to two-day jobs, with every wire needing to be replaced and splicing taking considerably longer than either terminating copper or plugging in a connectorised dropwire!
If only a dynamic engineering director had addressed this when they were working for the company, eh Mr Whale 😉
Makes more sense for VM to buy this rather than Netomnia
Didn’t they buy it for around 600M?
At the time, they had full control, it was either use KCOM for fibre, or that’s your lot. With the Altnets now in (CityFibre and MS3) that’s no longer the case, which means the bottom line for them will be a lot different now to what it was back then.
They’ll never recoup the cost they paid – I just can’t see who would want in?