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Liberty Global has put on hold plans to find investors for Virgin Media’s O2 fixed NetCo in the UK, while Telefónica continues its strategic review.
Both Liberty Global and Telefónica own a 50 percent stake in Virgin Media O2, a telco formed as a merger between Virgin Media and O2 in 2021.
It was reported by Bloomberg last year that Virgin Media was seeking £1 billion ($1.34bn) for a stake of 20-40 percent in the venture.
But plans to pursue a stake sale have been put on hold while Telefónica continues a strategic review which began earlier this year under its newly elected chairman, Marc Murtra.
This was confirmed by Liberty Global CEO Mike Fries during an earnings call last week.
“We pride ourselves on being good partners, and we appreciate and understand Telefónica’s position,” said Fries. “Undoubtedly, we will have more to say about all of this as the year unfolds. In the meantime, there are multiple ways to continue to strengthen VMO2’s competitive position in the UK. Our services already reach seven million fiber homes.”
Murtra’s review centers around five key principles. These are changes in Europe, ensuring customers are the center of everything, technology, and operational excellence as the pillars of Telefónica’s business, the company acting with disciplined industrial logic, and the creation of value for customers, employees, and shareholders.
“We’re going to keep figuring out how we create value for shareholders, and they’ll be doing the same thing. So I would say it’s a very good dialogue,” added Fries.
Virgin Media O2’s fixed network is the biggest challenger to BT’s Openreach, which has surpassed more than 17 million premises with its fiber build-out so far.
Along with Nexfibre, which is an independent fiber joint venture between Liberty Global, Telefónica, and Infravia, the separate NetCo and Nexfibre networks will reach a combined total of up to 23 million homes, placing the company in a stronger position to compete with Openreach, which is aiming to deliver FTTP services to 25 million premises by 2026.
Nexfibre notably completed the acquisition of UK altnet Upp in September 2023 and plans to invest more than £350m ($467m) in Eastern England by 2026.
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