Lloyds Banking Group PLC (LSE:LLOY), NatWest Group PLC (LSE:NWG) and the UK taxpayer-backed National Wealth Fund (NWF) are reportedly close to taking control of broadband provider Gigaclear, after an attempted sale failed.
Creditors including NWF, Lloyds and NatWest will now take control of the "heavily indebted" outfit, the Financial Times reported, citing people with knowledges of the matter.
The creditors will run the business before exploring another sale process.
Gigaclear has built a full-fibre network across over 600,000 premises around rural England, with around 160,000 customers on its books.
In 2023, the firm agreed a debt facility of up to £1.5 billion by a consortium of banks comprising Lloyds, NatWest, ABN AMRO, HSBC and several European lenders, with the NWF providing a guarantee covering £240 million of commitments.
Reports last November suggested a buyer for Gigaclear was being sought, before the consortium agreed to provide at least £80 million of new funding in December, which Gigaclear said meant it was "fully funded to deliver its plans".
The FT report said the creditors have explored options such as writing down debt.
Gigaclear is not the only UK 'altnet' broadband sector struggling with debt, with research from Enders Analysis calculating the subsector has total net debt of more than £9 billion.