KKR and Warburg Pincus are in early talks to sell London fibre network Community Fibre, people familiar told the FT. A sale would test returns for altnet investors.
Alpha Score of 40 reflects weak overall profile with poor momentum, strong value, poor quality, moderate sentiment.
Warburg Pincus and KKR are weighing a sale of their UK fibre broadband assets, including Community Fibre, the Financial Times reported, citing people familiar with the matter. Early talks with potential buyers have started, the newspaper said.
Community Fibre is a London-focused fibre network backed by the two private equity firms. It has passed roughly 1.3 million homes in the capital, mostly in lower-income areas where take-up rates lag wealthier boroughs. The company raised debt and equity in 2022 to fund expansion. Since then, the UK altnet sector has seen a shakeout. Competitors such as Gigaclear and CityFibre have changed hands or sought new investment. TalkTalk’s fibre arm was sold last year.
A sale would let KKR and Warburg Pincus exit a market where building out fibre to homes is capital-intensive and profit remains distant for many altnets. Community Fibre alone represents a bet of billions of pounds sunk into a single-city network that now faces price competition from BT’s discounted wholesale tariffs and Virgin Media O2’s cable upgrades. Ofcom’s push to keep wholesale prices low has also squeezed margins.
KKR’s broader infrastructure portfolio spans energy, telecoms, and other assets. On AlphaScala’s proprietary scoring, KKR carries a Mixed label with an Alpha Score of 38 out of 100, reflecting a neutral risk-reward setup relative to its Financials sector peers. The UK broadband exit, if it materialises, would recycle capital into new deals. Read the full KKR profile
Warburg Pincus has been paring its UK telecom exposure for months. The firm sold its stake in TowerCo, a UK mobile tower operator, to a consortium led by Brookfield in 2023. Community Fibre is a bigger bet. Earlier fundraising rounds valued it at over £1 billion, the FT reported. Interested buyers could include infrastructure funds seeking inflation-linked returns or strategic players looking for access to London’s dense subscriber base.
A deal would test whether long-term investors still see the altnet thesis – building a parallel fibre network that can undercut incumbents – as viable after a year when several operators missed their build targets. The next step is whether any of the reported bidders tables a formal offer. Warburg Pincus and KKR have not confirmed the process. The sale is still at the exploratory stage.
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