Virgin Media O2 - comment

The results are broadly in line with our model, with subscribers slightly lower. Operationally, VMED is stabilising, but growth opportunities are limited. The bigger news today is the possible purchase of fibre company Netomania.  The £2bn price would add around 0.7x turns of leverage to VMED, if no equity were provided. If the £400m of shareholder distributions were foregone for a year, that falls to 0.6x. The target company currently generates little in the way of EBITDA. Buying Netomania would provide more fibre for VMED and prevent the asset from being acquired by CityFibre. We expect that there will be questions on a potential deal on today’s Liberty Global call.

 Netomania’s fibre network covers 3 million homes and has 400k customers (14% penetration). Digital Bridge Group, Soho Square Capital, and Advencap are investors in the company.

https://news.virginmediao2.co.uk/2025-financial-results/q2/

https://www.ft.com/content/f1e46532-5f3b-4bc4-9435-334437bcf9f2