£100m UK Infrastructure Bank investment helps provide quarter of a million rural homes with ultrafast broadband 

The UK Infrastructure Bank has today confirmed it will invest £100 million as a co-lender in providing high-capacity broadband to hard-to-reach UK premises through the internet provider Gigaclear.

Communities across the South West, the Midlands and South East will have their digital connectivity enhanced with greater opportunity to access ultrafast “full fibre” broadband, thanks to a deal co-financed by the UK Infrastructure Bank.  

 
The £100 million from the UK Infrastructure Bank has facilitated £90 million of private sector investment  from five other lenders; ABN Amro, ING, Lloyds Bank, Natwest and NIBC. The total facility of £190 million will support Gigaclear in their current roll out programme and deliver broadband to a further c.250,000 properties, to meet their ambitions of connecting of 500,000 properties by 2023. 90% of these will be in hard-to-reach rural properties, which are currently underserved by the commercial market. 

The increase in speed and broadband coverage will help accelerate the country’s recovery from Covid-19, boosting high-growth sectors such as tech and the creative industries, and enabling people to work from home and run businesses online from anywhere in the UK. The lending supports the Government’s wider target for at least 85% of UK premises to have access to gigabit-capable broadband by 2025 and is in line with the UK Infrastructure Bank’s mission to boost economic growth across the UK.

Full fibre offers the fastest and most reliable broadband available (up to 1,000 megabits per second, or one “gigabit”), is more energy-efficient and less carbon intensive than networks which use copper. The government has made improving connectivity a priority and currently 63 per cent of UK homes and businesses have access to ultrafast gigabit broadband, up from just 6 per cent at the start of 2019. Connectivity is being delivered through commercial providers as well as through government funded schemes such as Project Gigabit. 


Digital Infrastructure Minister, Julia Lopez said:

 “Digital connectivity has never been more important and through our £5 billion Project Gigabit the government is levelling up communities with much faster broadband speeds. But we can only complete this nationwide internet upgrade with the help of broadband firms such as Gigaclear. This significant investment in Gigaclear by the UK Infrastructure Bank brings us closer to making sure everyone benefits from new internet-connected technologies in the coming decades."

John Flint, CEO of the UK Infrastructure Bank, said:

 “The Covid-19 pandemic has underscored how vital reliable and good quality broadband is to every part of the UK. It’s an essential part of everyday life, as the UK increasingly relies on it for working from home, online shopping, and entertainment. This deal will not only benefit rural residents, but businesses based in the countryside too. Nationwide full-fibre broad band will boost UK productivity significantly, support regional and local economic growth, and bring more people back into the workforce through remote working. We are very happy to support the Gigaclear programme alongside our co-lenders and are grateful for the support of Lloyds who acted as Coordination Bank with the UKIB for this specific transaction” 

Gareth Williams, CEO of Gigaclear, said: 

 “There are areas of rural England where the internet is around 1Mbps, that is slower than old fashioned dial-up speeds. Astronauts on the International Space Station have better internet access.  This investment will help us bring our full fibre network to some of the most underserviced areas of the country that have been left behind in the dark ages of internet access, bringing them speeds of up to 900Mbps and beyond. Its hard to put into words the level of impact this kind of upgrade has on communities, but in essence, it means rural businesses can thrive, people can work from home without issue, streaming services are actually usable, and loved ones can stay in touch over long distances. We’re grateful to the UKIB and our other investors for this show of confidence and look forward to lighting up more and more communities across the country.”  

Scott Barton, Managing Director (Corporate & Institutional Coverage) at Lloyds Bank, said: 

 “Digital infrastructure is key to the future of the UK economy, with the pandemic only serving to underline the importance of reliable, fast broadband. That said, much still needs to be done to achieve the government’s 2025 target, which is why we are delighted to have worked alongside the UK Infrastructure Bank to fund, facilitate and accelerate fibre rollout by way of this transaction. This support of vital infrastructure can help cultivate a more sustainable and balanced UK economy for all.”

The UK Infrastructure Bank opened for business in June 2021 to tackle climate change and boost growth across the United Kingdom. This marks a third transaction for the bank, which has supported UK’s wind -power supply chain through a loan to Tees Valley Combined Authority. It has also helped to potentially double the amount of subsidy-free solar power production across the UK through its deal with NEXT Energy. The bank is committed to invest in a wide range of sectors which meet its strategic objectives, and investment principles, which can be found on the UK Infrastructure Bank website. 
 

Further information:


UK Infrastructure Bank

 

• The UK Infrastructure Bank was announced as part of the Government’s National Infrastructure Strategy in 2020 and launched in June 2021. Its objectives are to help tackle climate change and to support regional and local economic growth. More detail is available in the UK Infrastructure Bank Policy Design Document and the Bank’s Framework Document, both of which are on our website.
• The Bank is operationally independent from Government - projects are assessed by the Bank, approved through an Investment Committee and signed off by the UK Infrastructure Bank Board. Given the size of this deal and the early stage of the Bank’s development, HMT Ministers performed a role in formally approving the deal put forward by UKIB Board.

Gigaclear 

 

• Since 2010, Gigaclear has been building infrastructure to connect rural homes and businesses to Gigabit capable, full fibre broadband. Its network is across communities and market towns in Oxfordshire, Buckinghamshire, Hertfordshire, Herefordshire, Gloucestershire, Wiltshire, Berkshire, Somerset, Devon, Dorset, Northamptonshire, Lincolnshire, Leicestershire, Kent and Essex. 
• The roll out is commercially funded with some specific areas of build benefitting from subsidy as part of the Governments Building Digital UK (BDUK) programme. The investment from the UK Infrastructure Bank is part of the commercially funded programme. 

Project Gigabit

 

• The government’s £5 billion Project Gigabit is aiming to bring faster and more reliable internet speeds to hard-to-reach areas that would otherwise miss out on being connected through normal industry rollout. The government has already identified up to 2.5 million hard-to-reach homes and businesses in scope of Project Gigabit across England, Wales, Scotland and Northern Ireland and further areas will be identified. Further information is available on Gov.uk