KCOM buyout means more fibre for Yorkshire

Hull's homegrown ISP sells for more than half a billion.

photo of a phone box in Hull
Img: Paul Lakin

Monday, 19 August, 2019

Hull ISP K-COM has been acquired for £627 million by infrastructure investment group, Macquarie Infrastructure and Real Assets (MIRA).

New plans for the company include expanding their full-fibre network to 100% coverage in Hull, and reaching into more of East Yorkshire.

K-COM is the only network operator in Hull, and the only telecoms network that didn’t get swallowed up by BT more than 100 years ago. This makes Hull unique. It is the only city in the UK with zero Openreach connections. That means there’s only one choice when it comes to fixed-line broadband – KCOM.

Although KCOM is obliged to offer wholesale network space to other ISPs, their unique position makes it difficult for other companies to compete.

No choices in Hull

This monopoly means there’s little choice for Hull customers when it comes to picking broadband deals. However, a dedicated single network does grant some benefits.

Hull currently has more full-fibre coverage than anywhere else in the country. More than 96% of premises in Hull can get full-fibre. Around 9000 premises still aren’t connected, as KCOM need “third-party permission” to cross their lines through private property.

MIRA is now looking at further expanding on KCOM’s network.

We are looking forward to working closely with KCOM’s management team and workforce to increase fibre accessibility and reduce digital exclusion in the region. By investing to develop and expand KCOM’s networks, we hope to deliver the infrastructure that will underpin growth and innovation in East Yorkshire.

- Leigh Harrison, Head of Europe, Middle East, and Africa, MIRA

MIRA holds over $120 billion in assets, and invests in telecoms, property, farmland, and other businesses.

KCOM was purchased after a month of auctioning. Fibre connections are going to worth big money in the coming years. So investors are jumping at the chance to own any piece of it.

A big buyout

In April, KCOM was offered £504 million by investors, Universities Superannuation Scheme Ltd (USSL). But rival bids from MIRA pushed the company towards an open auction, where it gained another £120 million in value from the first offer.

Such a large investment from a multinational like MIRA may encourage further interest in the UK’s broadband infrastructure. And more interest from investors means more fibre for us.

There are currently no concrete plans for how KCOM will expand their network. Private equity investment is typically hands-off. This means we’re unlikely to see many big changes to KCOM’s management or operations.

 

Samuel Newman author picture

By:

Samuel Newman is a consumer journalist and blogger based in Sheffield.

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