Nexfibre CEO Rajiv Datta slams CMA opposition to Netomnia acquisition

The CMA's decision to block the Nexfibre Netomnia acquisition signals a shift toward active market steering rather than traditional competition oversight. By favoring a CityFibre tie-up to preserve a three-way wholesale market, the regulator is prioritizing localized competition over the creation of a scaled challenger to Openreach's 23 million-home dominance. This intervention complicates the necessary consolidation of the UK's fragmented 'altnet' sector, where many providers face deteriorating financial outlooks and slowing build rates. Industry observers should monitor whether this regulatory stance forces Netomnia into a lower-value sale or if the CMA applies similar 'counterfactual' logic to BT Group acquires TalkTalk.

The Nexfibre Netomnia acquisition has drawn sharp criticism from the CMA, which provisionally found that the deal would substantially lessen competition in wholesale broadband supply across the UK. The CMA's interim report gives Nexfibre and Substantial until 5pm on 16 October to submit remedy proposals, with a final decision due by 15 December 2026. The regulator's preferred counterfactual is that CityFibre would have acquired Substantial and wholesaled the Netomnia network to ISP customers including Sky and VodafoneThree, while selling the retail brand YouFibre to a third party. Nexfibre's shareholders called the findings a misreading of Britain's fiber market, and CityFibre, which bid for Substantial in 2025, urged the regulator to block the deal outright.

Nexfibre CEO Rajiv Datta has framed the CMA's opposition as detached from commercial reality. In an interview with Reuters, Datta called the regulator's CityFibre scenario a "counter-fantasy" and argued the CMA had failed to prioritize the fiber investment Britain needs. He emphasized that the transaction is fully financed and ready to close, adding more than 3.4 million premises and over 500,000 customers to Nexfibre's footprint for a combined total of 8 million premises by end of 2027. Combined with Virgin Media O2, also owned by Liberty Global and Telefónica, the group would reach 20 million premises over time, compared with 25 million for BT's Openreach network.

The competitive dynamics between Nexfibre and CityFibre are central to the CMA's analysis. CityFibre covered about 4.7 million properties with its full-fiber wholesale network at end of 2025, supporting 848,000 connections, but added fewer than 600,000 premises in the subsequent 18 months. CityFibre had reported overall debt of roughly £3.7 billion and a net loss of £360 million on just £134 million in sales for 2024, though revenues grew to £170 million in 2025. The company reportedly cut about 400 jobs, roughly a third of its workforce, as part of a strategic shift from building to acquiring networks. Datta contrasted CityFibre's consolidation rhetoric with its execution challenges, arguing that Nexfibre's anchor tenancy arrangement with Virgin Media O2 provides the monetization foundation that CityFibre lacks.