Broadband bods Gigaclear bag £24m for rural hi-speed internet

Rural broadband provider Gigaclear has bagged an additional £24m in investment, part of its plans to serve 1.5 million homes currently without fibre-to-the-premises networks.

This investment follows a cash injection of ‎£20m (€25m) from the EU-controlled European Investment Bank in January. Gigaclear is targeting a fund-raising goal of £90m this year.

Gigaclear offers customer speeds of between 50Mps to 1Gbps via its optic fibre networks. So far it has built 60 rural fibre networks, with 25 in construction.

By the end of 2015, it had more than 15,000 homes on its network.

For the full-year 2015 the company reported an operating loss of £6m, up from an operating loss of £3.3m the previous year, according to its Companies House filing. It attributed the to expansion costs, mostly people related.

Matthew Hare, chief exec of the biz, said the company plans to add tens of thousands of new customers this year. "The strong financial support of our shareholders lets us get on with the job of delivering Britain’s best future-proof broadband without delay.”

Philip Carse, analyst at Megabuyte, said the company's infrastructure investment ought to yield profits for decades to come "albeit after an estimated near ten-year initial payback."

He noted the contrast with its listed peer CityFibre, which focuses on bringing superfast broadband to towns and cities, with a WAN rather than FttP focus.

The latter has a similar market cap of £118m, having just raised £80m to fund the £90m acquisition of Kcom’s national network, said Carse.

Gigaclear said it now has a market cap of £115m, following the investment raised from Prudential Infracapital and Woodford Investment Management. ®