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Why CityFibre's KCom deal has provided a leap forward

The fibre optic network specialist posted strong gains and recently completed a key acquisition
April 18, 2016

Soaring demand for high-speed connectivity has strained the capacities of broadband providers and mobile operators. This has pushed more and more to CityFibre Infrastructure (CITY), which builds and rents out access to fibre optic infrastructure in urban areas. Brisk trading narrowed the group's operating loss by 17 per cent to £6.2m in 2015. But the real triumph for investors was its £90m purchase of network assets from KCom (KCOM) in January, which more than doubled the size of its network. Management said this move had accelerated its expansion by at least five years.

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CityFibre won city-wide construction projects in Newport, Edinburgh and Glasgow in the period. It also signed up Vodafone and other service providers, increasing its partner count from 25 to 41. The upshot was that it signed over £23m in contracts - more than double the figure for 2014.

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