CityFibre snaps up Entanet for £29m and plans to raise £185m
Wants to pump fibre to 50 cities by 2020
Small Brit broadband provider CityFibre has splashed £29m on connectivity service Entanet and is seeking to raise £185m in additional funds.
The cash pile will be used to expand CityFibre's fibre metro area network from 42 to 50 UK cities by 2020.
CityFibre said it expects to make around £3m per year by 2020 from the Entanet via its estimated base of 1,500 channel partners to reach more business customers.
The firm had previously splashed £90m on KCOM's national infrastructure – excluding Hull and East Yorkshire – in 2015.
It has been on a fundraising trail for some time, having bagged an additional £24m in investment last year on top of £20m (€25m) from the EU-controlled European Investment Bank.
Greg Mesch, chief exec of CityFibre, said: "With Entanet now part of the CityFibre family, our combined offering will accelerate the take-up of services over our growing network footprints, leveraging Entanet's enviable channel partner network and continuing to transform digital connectivity for thousands of UK businesses.
"Today's capital raising also better positions CityFibre to undertake larger projects coming forward with the public sector as well as mobile operators in readiness for their small-cell rollouts and 5G services."
Mesch recently welcomed the government's £400m Digital Infrastructure Investment Fund, aimed at boosting Blighty's full-fibre infrastructure – suggesting the company may be interested in drumming up cash via that route, too.
During its full-year ended 2016, CityFibre posted sales of £15.4m, up 140 per cent on the previous year and and earnings before interest, tax, depreciation and amortisation of £2.5m, compared with a loss of £2.9m in 2015. However, after tax the biz posted a net loss of £12.6m.
Entanet posted a turnover of £35.8m during 2016, up 12 per cent from 2015. ®