CityFibre is preparing to cut a third of all jobs as part of plans to streamline operations.

The Financial Times (FT) reports that the UK altnet (alternative network provider) plans to axe 450 of its circa 1,400 employees, according to a letter seen by the newspaper.

The planned cuts follow a £2.3 billion ($3.17bn) financing round in July of last year.

It also follows the appointment of its CEO, Simon Holden, in September, replacing the previous long-term chief executive, Greg Mesch, who stepped down for personal reasons.

CityFibre’s current debt sits at around £3.7bn ($5.1bn) as of last year. The company positions itself as the main challenger to the UK’s broadband giants, BT’s Openreach and Virgin Media O2.

Founded in 2011, CityFibre is a fiber-only provider. The company has been pushing to take on the UK’s incumbent fiber providers, Openreach and Virgin Media O2. The company’s network passes more than 4.5 million premises, according to Mesch, which is slightly behind Virgin Media O2’s seven million. Both trail behind Openreach, a subsidiary of BT Group, which has passed more than 20 million premises.

In a letter sent to staff today (January 28), Holden, formerly a banker at Goldman Sachs, told employees that CityFibre’s “current structure” was “no longer the right fit for where our business is heading.”

“Instead, we need a simpler operating model that supports the expansion of our footprint at pace through M&A, leverages our heavy investment in systems and capabilities, and focuses on delivering market-leading services for our customers at the best possible economics,” he wrote in the letter. 

The timing of the potential cuts comes amid notable struggles for the altnet industry, in part because of higher borrowing costs and shareholder unrest.

Earlier this month, another altnet, ISP G.Network filed for administration due to high costs. A proposed rescue has reportedly fallen through, reports The Telegraph.