CMA Begin UK Competition Probe of Netomnia’s Acquisition by VMO2’s Owners UPDATE

The Competition and Markets Authority (CMA) has this morning launched an initial review of the proposed £2bn acquisition (here) of alternative full fibre UK broadband operator Netomnia (Substantial Group) by the parents of nexfibre and Virgin Media (O2) – Liberty Global, Telefónica and InfraVia.

At the moment the CMA are only issuing an “invitation to comment” to allow interested parties to submit to the CMA any initial views on the impact that the transaction could have on competition in the UK. The CMA has not yet launched a formal investigation into the transaction and is taking feedback until 8th May 2026 for “any interested party“.

Just to recap. The owners of nexfibre (InfraVia, Liberty Global and Telefónica), which shares some of its parentage with Virgin Media and O2, announced in February 2026 that they’d reached a £2bn deal to acquire Netomnia (here), which had at the time already deployed their own full fibre network across 3 million UK premises (rising to c.3.4m premises and 500k customers by deal completion – expected by Q3 2026).

Nexfibre said the deal would unlock £3.5 billion of investment in the UK market and help to upgrade 2.1 million of Virgin Media’s premises from coax to full fibre (FTTP). The combined nexfibre and Netomnia footprint is expected to reach 8 million premises by the end of 2027, which when combined with Virgin Media’s network could collectively reach 20 million premises and create a “scaled, financially secure challenger to BT Openreach“.

Rajiv Datta, CEO of nexfibre, said:

“We acknowledge the CMA’s initial review and will continue to engage constructively.

Our proposed acquisition of Netomnia unlocks £3.5 billion of capital and creates financially-secure, scaled wholesale competition to BT Openreach.

Acting now will strengthen the sector, and deliver greater choice, resilience and long‑term investment in full‑fibre infrastructure.

This transaction aligns with Government ambitions to back growth and remove barriers to investment, and timely progress will help ensure these benefits are realised.”

However, the move also prevented one of the market’s largest alternative networks – CityFibre – from securing its own merger deal with Netomnia and thus growing the scale it needs to properly compete, which has caused some to worry that we may ultimately end up back in a duopoly market between Openreach and VMO2 (nexfibre). But this alone could also be seen as a win for VMO2/nexfibre, albeit a potentially expensive one given the price tag paid. Both CityFibre and Ofcom have since indicated that they would like the CMA to review the deal.

In addition, many of Netomnia’s customers originally moved to YouFibre as a means of escaping from Virgin Media’s service, and have thus expressed concern at the deal and its potential future impacts (pricing policies etc.). As part of the deal nexfibre will sell Substantial Group’s retail business, including the YouFibre and Brsk brands, to VMO2 for £150m “ensuring customers continue to receive the same trusted service they know today“.

Simon Holden, CEO of CityFibre, said (Feb 2026):

“There’s an 80 percent overlap between these two players and, if the deal goes ahead, it would significantly reduce competition and the choice available to consumers, as well as force hundreds of thousands of Netomnia customers back to VMO2. Given the scale of this overlap, the CMA must thoroughly examine the deal.

Competition has driven lower prices, faster speeds and better services and this deal risks re-establishing an ineffective duopoly of BT and VMO2 and undermining the significant progress the UK has made.”

Regular readers may recall that the CEO of Liberty Global (Mike Fries) recently threatened stop their own FTTP deployments if the deal doesn’t go through: “Maybe we stop building fibre, or Nexfibre stops building fibre … the only counterfactual that’s certain is BT gets stronger” (here), although at present most of the group’s build activity seems to be focused on upgrading Virgin’s coax (HFC) areas to FTTP.

Completion of the transaction is currently expected by Q3 2026, but that does depend upon the CMA and whether it chooses to proceed with a deeper investigation. A Phase 1 probe is perhaps to be expected, but Phase 2 would go deeper and may push completion into 2027.

However, given the CMA’s recent flexibility toward big telecoms mergers (e.g. Three UK and Vodafone) and the Government’s broadly favourable response to the deal, it’s not unreasonable to expect that they may ultimately allow the consolidation to go through, albeit possibly with some concessions.

Quite what form such concessions, if they do indeed materialise, may take is as yet unclear. But we wouldn’t be surprised if it included stronger wholesale requirements for Virgin Media’s consumer broadband network and nexfibre, which is something that the operators already seem to be preparing to deliver (here). Time will tell.

UPDATE 1:29pm

We’ve had a new comment from CityFibre.

A CityFibre spokesperson said:

“VMO2/nexfibre’s planned acquisition of its altnet challenger, Netomnia, raises important questions about the UK’s ambitions for digital infrastructure. It’s good to see the CMA has now invited engagement with industry and consumer groups to build its expert, independent view.”