Goldman-backed fibre broadband venture takes Holliday as chair | Business News

By September 16, 2019 No Comments
Steve Holliday, former chief executive of National Grid

The former chief executive of National Grid will this week be named as the chairman of the ultrafast broadband network vying to become BT Group’s biggest British rival.

Daily Week News has learnt that Steve Holliday, who won plaudits among investors during his tenure at the energy infrastructure group before he stepped down in 2016, has agreed to take the helm of CityFibre.

Mr Holliday’s appointment, which is expected to be announced on Tuesday, will strengthen CityFibre’s ambitious expansion plans as it rolls out a £2.5bn investment programme.

The company, which is owned by Goldman Sachs-backed West Street Infrastructure Partners and Antin Infrastructure Partners, has committed to providing a new generation of wholesale full-fibre broadband to more than 5m homes and businesses by 2025.

That timetable coincides with a pledge made by Boris Johnson when he became Prime Minister to have comprehensive nationwide fast broadband by the same deadline.

Mr Holliday will bring a wealth of experience in overseeing critical utility infrastructure to the role.

Since leaving National Grid, he has served on the board of the Department of the Environment, Food and Rural Affairs, been chairman of the homelessness charity Crisis and a director of Business in the Community, among other roles.

One source described Mr Holliday’s recruitment as part of “a general upgrade” of CityFibre’s management following the arrival of former Goldman partner Simon Holden as chief operating officer.

Mr Holliday’s appointment at CityFibre comes as the company progresses discussions about a bid for a rival venture set up by TalkTalk, the FTSE-250 telecoms group.

Daily Week News revealed recently that CityFibre is among a small number of bidders battling to take control of FibreNation, which wants to build fibre connections to 3 million UK homes.

CityFibre’s interest underlines the land-grab taking place for share of a market given added impetus by Mr Johnson’s broadband pledge.

Both CityFibre and FibreNation are among a string of independent companies set up in the last decade to deliver full-fibre communications to British homes and businesses.

For the Goldman-backed venture, acquiring FibreNation would provide additional customer volumes to its business.

CityFibre has struck an agreement with Vodafone to be its first ISP customer, and late last year announced a £1.12bn debt package from banks including Deutsche Bank, Lloyds Banking Group and NatWest, part of Royal Bank of Scotland.

Like other new competitors, CityFibre has been set up to seize market share from Openreach, the BT Group subsidiary which now operates on a more arms-length basis from its owner.

Liberty Global, the owner of Virgin Media, is in the process of establishing a new joint venture in order to compete in a more expansive way in the broadband market.

A number of smaller players, including Hyperoptic and Gigaclear, have also been set up, leading analysts to question how many of the new companies are likely to be financially successful.

BT, meanwhile, has signalled that it may cut its dividend in order to fund the huge investment required to accelerate full-fibre broadband provision.

The possible reduction to shareholders’ payout will be among the biggest calls made by Philip Jansen, BT’s new chief executive, and his colleagues on the board.

The prime minister has made a comprehensive roll-out of ultrafast broadband a cornerstone of his pitch to voters.

His chief business adviser is Andrew Griffith, the former chief financial officer and chief operating officer of Daily Week News’ immediate owner, Sky.

Nicky Morgan, the new culture, media and sport secretary, is understood to be planning to meet industry bosses later this week to discuss the government’s plans.

A CityFibre spokeswoman declined to comment.

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