CityFibre has agreed to acquire alternative fiber network (altnet) provider Lit Fibre from Newlight Partners.

Although the company didn't disclose the financial details of the transaction, Sky News reported that CityFibre has paid around £80 million ($101m).

CityFibre said the acquisition will help it to achieve its target of reaching eight million UK homes with its full fiber broadband by the end of next year.

Its network build-out has been funded by billions of pounds in debt and equity funding.

The acquisition adds 300,000 premises as it is an entirely share-based acquisition, which will see Newlight Partners become minority shareholders in CityFibre.

The deal is expected to be completed in the second quarter of this year.

Lit Fibre serves more than 200,000 homes across counties including Wiltshire, Gloucestershire, and Hertfordshire.

In a statement last week, CityFibre said it "will begin to rapidly integrate Lit’s infrastructure into its nationwide, carrier-grade network, including its passive, active and operational support systems."

The altnet, which is Openreach's biggest independent challenger in the UK, also said it intends to complete Lit's own fiber deployment, which is on track to reach a further 100,000 premises by 2025. Its network is built exclusively using existing poles and ducts.

“Our self-build rollout program has already delivered more than 3.5m premises to our partners and we’re excited to accelerate this even faster through targeted acquisitions like Lit Fibre," said Greg Mesch, chief executive officer at CityFibre.

"But competition is not just about scale, it’s about providing partners access to carrier-grade networks that reduce their costs to serve and improve the service experience they can provide their customers. The UK market needs a third infrastructure platform of scale to ensure competition matures and that it continues to deliver for consumers and the country. Our acquisition of Lit is a clear demonstration of our intent to establish CityFibre as the core of that third platform.”

CityFibre has previously acquired other altnets, notably that of FibreNation's network from TalkTalk for £206m ($261m) back in 2020. That particular deal saw CityFibre increase its targeted rollout from five million premises to the current target of eight million premises.

Other acquisitions include Entanet back in 2017 for £29m ($36m), plus the acquisition of national network assets KCOM and Redcentric.

Separately, CityFibre has also been the subject of interest from a proposed takeover by Virgin Media O2 last year, with the latter valuing the company at around £3 billion ($3.81bn).