CityFibre has secured £900 million in new funding as it seeks to expand through acquisitions amid mounting financial pressures. The broadband infrastructure provider, which operates a full-fibre network reaching approximately 4.7 million premises, raised the capital from investors including Goldman Sachs and Mubadala, a sovereign wealth fund based in Abu Dhabi.

This latest injection follows a £1.5 billion refinancing deal completed in 2022 and is intended to support CityFibre’s strategy of acquiring smaller competitors in the crowded alternative network (alt-net) sector. The company is reportedly targeting firms with network coverage exceeding one million homes, such as Hyperoptic and Community Fibre.

As the largest alt-net in the United Kingdom and a key competitor to BT’s Openreach, CityFibre has faced challenges from rising interest expenses on its nearly £4 billion debt load, as well as intense market competition and slower-than-anticipated customer adoption. These factors have increased financial strain, prompting the company to strengthen its capital base through new equity financing.

CityFibre had previously indicated that its 2022 funding would sustain operations until mid-2027. However, it anticipates requiring an additional £2.5 billion from 2025 to 2030, raising the possibility of further support from investors. According to a source familiar with the company’s plans, CityFibre is considering a limited recapitalization of its debt, potentially involving a debt-for-equity swap or an extension of existing loan terms.

A company spokesperson emphasized ongoing operational progress, stating that CityFibre has surpassed one million connections and is experiencing profitable growth. The recent funding round underscores the challenges faced by infrastructure providers in balancing rapid network expansion with financial sustainability amid a highly competitive sector.