Ares Management is taking control of Toob, a loss-making UK fibre broadband operator backed by the government's National Wealth Fund, following a debt-for-equity restructuring.

The restructuring wipes out equity held by Toob's backers. Its controlling shareholder was the National Digital Infrastructure Fund, managed by Amber Infrastructure Group for investors including the National Wealth Fund and International Public Partnerships (INPP). INPP said it would transfer its £24.1m ($32.7m) equity interest to debt holders for a 'de minimis' amount, deciding against further capital.

Ares provided Toob with a debt facility of roughly £160m ($217m) in 2023, now converting that senior position into control. Toob is one of several 'altnets' building rival networks to challenge BT Group's Openreach. Like peers, Toob expanded quickly on heavy funding but remained unprofitable.

With financing costs higher and pressure to reach profitability, the sector faces consolidation via mergers, asset sales, and restructurings. The National Wealth Fund took control of Gigaclear this year after accepting a haircut on near-£1bn debt. For the taxpayer-backed fund, the Toob restructuring marks a second bruising encounter with a sector exposing state capital alongside private lenders.