Ares takes control of UK fibre operator Toob
Ares Management has taken control of UK broadband provider Toob after the company’s existing shareholders agreed to transfer their stakes to the private credit firm, which is also its senior lender, according to a report by Bloomberg.
Private credit firm Ares Management has assumed control of UK broadband company Toob, following the consent of existing shareholders to transfer their holdings to the lender, which is also Ares, according to Bloomberg. The details, as shared by unnamed sources, indicate that Ares is contributing an undisclosed quantity of fresh equity into Toob as part of the company's restructuring process.
This move comes amidst the alternative fibre sector grappling with increased interest rates, sluggish growth, and the urgent need to attain profitability.
The National Digital Infrastructure Fund, managed by Amber Infrastructure for stakeholders including the UK’s National Wealth Fund and listed infrastructure investor International Public Partnerships (INPP), was Toob's biggest shareholder. INPP announced in a regulatory disclosure that it will cede its £24.1m ($32.7m) equity stake to Toob's creditors in exchange for a minimal amount after opting not to provide further capital. Ares had originally provided Toob with approximately £160m of debt financing in 2023.
The recent deal effectively transfers ownership to the lender while providing the ailing fibre operator with additional equity capital. Toob is part of a group of alternative network operators that have heavily invested in fibre infrastructure to compete with BT Group's Openreach. Many of these firms have faced difficulties in generating profits following rapid expansion funded by significant external investments.
The National Wealth Fund, too, has encountered comparable challenges elsewhere in the UK broadband market. Earlier this year, it, along with other lenders, took over rival operator Gigaclear after accepting losses on nearly £1bn of debt.
Written by urgent.news from Private Equity Wire's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
