Rural UK Broadband Altnet Voneus Quietly Completes Refinancing of Debts

The Senior MD at Macquarie, Oliver Bradley, has revealed that that one of the alternative broadband networks they support, Voneus, recently completed a renegotiation on their existing £70m debt facility over the summer. The move saw existing investors inject an unspecified amount of fresh funding to keep the operator going.

Some readers may recall that Voneus, not unlike many other altnets, has been struggling a bit recently with redundancies and a slowdown in their network build (here). This came after the operator also found itself having to withdraw (here) from their publicly funded Project Gigabit broadband roll-out contract for Mid West Shropshire (Lot 25.01), which was this month picked up by Openreach (here).

The company’s most recent accounts, which cover the year to 31st March 2024, revealed that turnover had increased by 34% to £4.417m, while gross profit shrank by -17% to £768.6k and total employees grew from 156 to 238. But Voneus’ loss before tax has also more than doubled to £36.65m (up from £14.83m), although their net assets have grown to be worth £93.43m (up from £23.32m).

However, a new report on TelcoTitans (paywall) reveals that Voneus appears to have quietly completed an important refinancing effort over the summer, which is a process that took around 3 months and involved some difficult negotiations with banks (creditors). The hope is that this will now enable the network operator to reach positive cash flow in the future.

Oliver Bradley indicates that this resulted in a sort of “amend and extend” agreement, wherein Voneus has been given some relief on the covenants it had agreed in securing the £70m debt facility, and an extension of the loan term by a number of years “to give us breathing room while we get to profitability and cash flow break even”.

In the meantime, details of how much extra funding has been injected alongside this remain unclear, although Voneus does confirm (Companies House) that the stated capital in terms of allotment of shares held by the company is now worth £131.48m (up from £110.68m a year earlier).