- VMO2 takes 70% stake in merged firm.
- New entity to serve 175,000 UK businesses.
What happened: VMO2 and Daisy merge to create major B2B provider
Virgin Media O2 (VMO2) will merge its business unit with Daisy Group. The move will form a new UK B2B telecoms provider worth £1.4 billion. Under the agreement, VMO2 will own 70% and Daisy 30% of the joint company.
Daisy provides broadband, mobile and fixed-line services to around 175,000 UK businesses. It also has hardware partnerships with Apple, Google and Samsung. The deal will combine £425 million in loans from VMO2 with £835 million of Daisy’s debt. Together, they will create £150 million in annual adjusted EBITDA.
The companies expect £600 million in savings, over half of which will come within three years. VMO2 CEO Lutz Schüler called the deal a step forward in digital growth. Daisy founder Matthew Riley will chair the new firm. Jo Bertram, head of VMO2 Business, will become CEO. The merger will close in the second half of 2025.
Also read: VMO2 claims customer service is improving amid mixed results
Also read: VMO2 reports revenue decline for 2024
Why it’s important
The merger creates one of the UK’s largest B2B telecom providers. The new firm will have a wide customer base and increased digital capacity. It will offer services to both small and large businesses. Combining networks and infrastructure improves efficiency. The merged firm can offer bundled services across IT, mobile and broadband. Daisy’s strong customer service record may face challenges after the merger. VMO2’s business unit has low Trustpilot ratings. This could impact customer trust.
Ofcom has noted high complaint levels against VMO2’s consumer division. Daisy customers may worry about future support quality. The companies will keep their current brands for now. Long term, cost savings may lead to changes in operations and support. The merger reflects a wider trend of consolidation in UK telecoms. It positions the new entity as a top competitor to BT and others in the B2B space.
