The office of Andy Burnham, the Mayor of Greater Manchester, backed a broadband merger deal in March that would have benefited a United Arab Emirates (UAE) fund. This fund is headed by Khaldoon Al Mubarak, the chairman of the scandal-hit Manchester City football club.
The Greater Manchester Combined Authority (GMCA) supported a proposed merger between a British broadband company, Substantial, and CityFibre, which is partly owned by an Emirati sovereign wealth fund. Al Mubarak serves as the chief executive of this fund.
This development adds to ongoing scrutiny of Burnham's ties to the UAE-owned club. He recently faced calls to disclose his connections to Manchester City after expressing concern about potentially losing its Abu Dhabi owners, following the club's breaches of Premier League financial rules. Burnham described the Emiratis as "a huge partner in the building of modern Manchester."
Separately, Prime Minister Rishi Sunak has faced accusations of misleading the public regarding undeclared dinners and free tickets related to Manchester City during Burnham's tenure as mayor.
Broadband Market Competition
The proposed deal for Substantial, which provides business-to-business broadband services, is one of two competing bids. Nexfibre, a joint venture between Liberty Global and Telefónica (which also owns Virgin Media O2), has submitted a £2 billion bid. Nexfibre argues it is in a stronger financial position than the loss-making CityFibre.
Mubadala, the UAE's sovereign wealth fund, is a significant investor in CityFibre, having contributed at least £800 million.
The Competition and Markets Authority (CMA) has been examining the potential merger due to concerns about market concentration in the broadband sector. According to the Sunday Telegraph, GMCA officials informed Substantial executives in March that they would recommend CityFibre as the preferred bidder to the CMA.
In a recent interim report, the CMA indicated a preference for CityFibre, stating that a Nexfibre takeover could reduce competition. However, Nexfibre has contested the CMA's findings, questioning CityFibre's financial viability.
A statement from the GMCA emphasized that its support for CityFibre was based on securing "the best possible value for our residents" and promoting market competition, resilience, and low prices, consistent with its publicly stated policies and the CMA's interim findings. CityFibre highlighted its business strength, citing additional funding commitments and customer growth.