Spring Fibre has been acquired by Harmony Networks for GBP 1.5 million.
Established in 2019 with the goal of delivering gigabit broadband to one million UK premises, Spring Fibre aimed to secure a prominent position in the country’s fiber rollout. Its deployment officially began in Lincolnshire in 2021, supported by GBP 150 million in raised capital for expansion.
Despite its ambitions, the company faced mounting operational costs and fierce competition in regional markets. To date, Spring Fibre has extended its full-fiber network to just 12,000 premises across the UK.
Spring Fibre’s financial challenges have come to light following its acquisition by Harmony Networks. A report confirmed that the alternative network provider was on the verge of collapse, burdened by GBP 11 million in debt. In 2022 alone, the company reported a loss of GBP 3.8 million, underscoring the financial strain it faced leading up to the sale.
Gareth Greppellini, CEO of Spring Fibre, indicated that while there had been significant interest in the business, including indicative offers, none provided the necessary liquidity within the required timeframe. He explained that, as a result, the company made the difficult decision to file a notice of intent to appoint administrators.
Harmony Networks has recently been confirmed as the buyer of Spring Fibre, acquiring the provider for GBP 1.5 million. This low acquisition price reflects several industry challenges, including rising costs of deploying fiber networks, intensified competition from larger providers, and a difficult funding environment. Many smaller players, known as alternative network providers (altnets), are struggling to sustain operations amidst these pressures.
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Broader Impact
The UK broadband market‘s increasing saturation and competition from established giants like Openreach and Virgin Media make it harder for smaller operators to scale. Additionally, economic pressures, such as inflation and increased borrowing costs, further hinder these providers from raising the necessary funds to expand or maintain their networks.
This situation not only affects altnets but also raises concerns about the infrastructure they leave behind if they fail, including potential liabilities for dismantling unused networks. Regulatory frameworks and financial safeguards for these cases are becoming more relevant as market consolidation continues.
