The company, which provides fibre connections in rural Scotland and Wales, has been forced to call in Teneo as administrators amid financial pressures, Sky News learns.
City editor @MarkKleinmanSky
Wednesday 31 May 2023 15:05, UK
The growing financial strain on Britain’s army of fibre broadband infrastructure providers has claimed its first casualty in the form of a rural network builder in Scotland and Wales.
Sky News has learnt that Broadway Partners, which launched in 2016, has called in administrators after its balance sheet was hit by soaring costs and rising interest rates.
The company had set an ambitious target of connecting 250,000 homes and businesses by 2025.
Industry sources said Broadway was one of many fibre infrastructure players facing severe financial pressures, with others expected to file for insolvency in the coming months.
Broadway has appointed Teneo Financial Advisory as administrator.
Its collapse puts more than 130 jobs at risk, although adequate funding is understood to be in place to keep the company trading during the administration process, while a buyer is sought.
Broadway’s collapse comes two years after it announced a funding package from Downing LLP, an investment firm which committed £145m to the altnet.
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At the time, Broadway said its mission was to „deliver affordable, high-speed broadband services to the more remote regions of the UK, particularly Wales and Scotland where there is a notable digital divide in countryside locations”.
It added that it had already connected thousands of premises in locations including Arran, Ayrshire, Perth & Kinross, Monmouthshire and Pembrokeshire.
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Other fibre network builders which have sought new investment or buyers in recent months include Trooli, another mid-sized entrant.
The market is dominated by BT’s Openreach division, but also includes large competitors such as CityFibre Holdings.
Virgin Media 02 is also a big emerging player in the industry’s rush for scale.
The pressure for consolidation has grown as costs have soared, while supply chain and labour issues have also conspired to impair altnet’s path to profitability.
Broadway could not be reached for comment on Wednesday.
Benji Dymant, joint administrator at Teneo, said: „Following significant investment in Ultrafast Full Fibre broadband, the sector has been facing into a number of adverse macroeconomic issues, including raising interest rates and inflation, in a highly competitive environment.
„Despite having successfully connected a range of outlying communities to its network, Broadway has not been immune to the impact of these issues.
„As a result, it’s been necessary to file for administration to facilitate a restructure of the business and provide a stable platform to affect a sale.”