TalkTalk Sells 120,000 UK Broadband Customers to CVC-Backed Rise Fibre

UK internet service provider TalkTalk has agreed to sell 120,000 of its broadband customers to Rise Fibre, a relatively new player in the market backed by CVC. The deal, whose financial terms were not disclosed, marks another step in TalkTalk's ongoing restructuring as it seeks to stabilize a shrinking customer base and refocus its operations.

For Rise Fibre, which only launched last year, the acquisition significantly bolsters its position. The company said the deal expands its total customer base to 250,000, a figure it has reached by leveraging wholesale access to networks operated by BT, CityFibre, Community Fibre, Trooli, Freedom Fibre, and 4th Utility. The company's rapid growth reflects a broader trend in the UK broadband market, where alternative providers are increasingly building scale without owning physical infrastructure.

"Reaching almost a quarter of a million customers so quickly is a fantastic milestone and shows that people are ready for a different kind of broadband provider," said Steve Wilson, CEO of Rise Fibre. "The acquisition of TalkTalk customers will help us bring the Rise Fibre experience to even more people across the UK. But we're only getting started. As we continue to grow, we'll keep customer experience at the heart of everything we do."

Wilson also outlined ambitious growth targets, saying Rise Fibre aims to reach one million customers, with further investment expected from CVC DIF, the infrastructure arm of CVC that has backed the company since its inception. The deal underscores how private equity-backed challenger brands are reshaping the UK's competitive broadband landscape, particularly in the fibre-to-the-premises segment.

For TalkTalk, however, the transaction raises fresh questions about its long-term direction. The company, currently the fifth-largest broadband provider in the UK behind BT Group, Sky, Virgin Media O2, and Vodafone, has seen its customer numbers decline sharply in recent years—falling from 2.5 million in 2023 to approximately 1.75 million today. It has also cut its overall headcount by 20 percent, including the loss of 130 jobs at its Salford consumer division in December.

The sale comes amid reports in June that VodafoneThree had submitted an offer to acquire TalkTalk's consumer business in an effort to strengthen its home broadband offering, though no further developments have been announced since. Last year, TalkTalk, founded by Sir Charles Dunstone, agreed to a £120 million ($165.7 million) capital injection from an existing shareholder to shore up its finances.

TalkTalk's corporate history has been marked by significant ownership and structural changes. In 2021, Toscafund Asset Management, previously the company's second-largest shareholder, completed a takeover of TalkTalk for £1.1 billion ($1.49 billion). Two years later, the company split its business into three units—B2B Wholesale Platform, TalkTalk Consumer, and TalkTalk Business Direct—before selling the latter to TFP Telecoms Limited, a special purpose vehicle controlled by the main shareholders of TalkTalk Telecom Group Limited.

TalkTalk declined to comment when approached by DCD for this story. The latest divestment is likely to intensify speculation about the future of its remaining consumer operations, as the company continues to navigate a highly competitive and margin-pressured market.