Business

Scottish National Investment Bank commits £20m to Lothian Broadband Group

LOTHIAN Broadband Group plans to more than double its workforce and expand into rural communities and small towns throughout Scotland, after a major funding deal with the Scottish National Investment Bank.

The taxpayer-backed SNIB has committed £20 million of funding to Lothian Broadband Group, declaring this money will “help tackle digital inequality in rural communities and small towns”. It is understood this injection is a mixture of equity and loan funding, with SNIB taking a minority stake in the fibre broadband business.

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Lothian Broadband Group chairman Kevin Hague said the firm’s expansion ambitions covered the whole of Scotland as he outlined plans to increase the workforce from around 25 to more than 60 by the end of 2022. He noted the company currently operates in East Lothian and the Highlands.

Mr Hague, who is among the private investors with a stake in the broadband firm, said: “There is a big scale-up going on.”

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SNIB noted its “cornerstone” funding commitment is in addition to £5m of new investment from the company’s current shareholders and is “part of Lothian Broadband Group’s plans to invest £75m to connect over 70,000 new premises in rural communities and small towns across Scotland over the next four years”.

Lothian Broadband Group’s chief executive is Gavin Rodgers. SNIB noted Mr Rodgers was “formerly head of a national fibre delivery organisation at Virgin Media and has a track record of deploying fibre at scale”.

SNIB said: “LBG is already investing to deliver full-fibre broadband across East Lothian. Today’s announcement signals an expansion of LBG’s geographic ambitions, with funding now secured to drive further operational scale-up and rapidly accelerate fibre deployment in 2022.

“Digital inequality has been heightened during the pandemic, and the Bank will be supporting a strong and experienced management team to roll out a future-proofed broadband network to tens of thousands of households and businesses who would otherwise be waiting years before receiving a gigabit-capable broadband service.”

Eilidh Mactaggart, chief executive of SNIB, said: “The Bank’s investment provides the cornerstone funding required for LBG to rapidly accelerate its operational scale-up and fibre deployment in 2022.”

She added: “This investment will support the improvement of digital connectivity in rural and semi-rural areas of Scotland, helping to address inequality of access to digital infrastructure outside of our cities and major towns.”

SNIB noted that one of its “three key missions” is “to extend the equality of opportunity by improving places”.

It said the funding for Lothian Broadband Group would “help increase digital connectivity to under-serviced communities”.

SNIB added: “A vibrant rural digital economy can also help reduce car journeys and assist a just transition to net zero by 2045.”

Mr Rodgers said: “The backing of the Scottish National Investment Bank enables us to continue our rapid scale-up as we establish the leading fibre-to-the-premise deployment platform for rural communities and small towns across Scotland.

“This new investment supports LBG’s commitment to building quality digital infrastructure and our inclusive, community-based approach to every village and town we serve.”

SNIB said the funding “supports UK and Scottish government commitments to high-speed broadband access”.

It added: “The UK Government has a target of at least 85% of the population having access to gigabit (1,000 Mbps) broadband by 2025 under its National Infrastructure Strategy.”

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