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Full Fibre UK ISP Gigaclear Seeks up to £300m Rollout Boost

Tuesday, Jul 26th, 2022 (9:22 am) - Score 2,064
Gigaclear-Engineer-Measuring-Distance

Infracapital-backed rural broadband ISP Gigaclear is reportedly working with bankers at Rothschild to raise up to £300m of additional capital to help fuel their ongoing rollout of gigabit-capable Fibre-to-the-Premises (FTTP) infrastructure, which has so far covered 300,000 premises (up from 250,000 in December 2021).

The operator’s full fibre network is already present in rural villages and towns across various parts of Oxfordshire, Buckinghamshire, Hertfordshire, Herefordshire, Gloucestershire, Wiltshire, Berkshire, Somerset, Devon, Dorset, Northamptonshire, Lincolnshire, Leicestershire, Kent and Essex in England. Going forward, the provider’s next target is to reach 500,000 UK premises by the end of 2023.

NOTE: Gigaclear is already being backed by around £700m of funding from various different sources (here and here).

The operator’s existing funding should, in theory (rural build costs can vary, a lot), be enough to get them to the 500k mark and thus today’s report on Sky News is more likely to reflect an ambition for a post-2023 rollout plan. If we assume that they continue to focus on more rural areas, and succeed in raising another £300m, then that might be enough to reach an additional 150,000 premises or so (educated guesstimate).

In recent months, we’ve seen Gigaclear move more into semi-urban towns, which means their investment can reach more premises for less money. But if Gigaclear also continues to build into some increasingly remote rural areas, where there’s less competition to worry about but the build costs are higher, then the funding will not go anything like as far.

On the other hand, Gigaclear may be looking to harness the additional investment in order to help it bid on match-funded contracts under the Government’s £5bn Project Gigabit procurements. In such an outcome, a big chunk of the related build investment would be coming from the public purse, rather than Gigaclear alone, which means that another £300m from investors could go further than we’d otherwise expect.

Investors currently still seem to have an appetite for putting money into new fibre builds, which is despite the UK market being overloaded with 100+ alternative networks – many of which are overbuilding rivals. But over time this market will consolidate and investors are likely to become more cautious. In other words, if you’re a full fibre builder that needs money, then the window of opportunity is still open, but it may soon become more difficult.

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Mark-Jackson
By Mark Jackson
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 and .
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Comments
5 Responses
  1. Avatar photo Fibreinukandrest says:

    How much would the total funding they’ve got be including this £300M?

    1. Mark-Jackson Mark Jackson says:

      They haven’t yet got the £300m, it’s part of a reported attempt to raise up to that amount. But if they were able to secure that then, including their debt raises, we’d be into £1bn territory.

  2. Avatar photo Just a thought says:

    Given there is currently an increasing shortage of fibre (recent news reports on world availablity) it makes even less sense to overbuild. If you get fibre in now you might be the only company to cover an area, then you can charge a premium!

  3. Avatar photo BILL says:

    I think gov needs to help, a must for rural people. We are always left out by openreach, mobile networks, dab, radio, you name it, all crap.

  4. Avatar photo Steve says:

    They are a awful business to deal with. If you have an alternative, take it!

Comments are closed

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