Virgin Media O2 is in talks to buy broadband network operator Netomnia.

As reported by the Financial Times, Virgin Media O2 is in discussions to acquire the fourth-largest broadband network operator in the UK in a deal that could be worth £2 billion ($2.64bn).

Netomnia is one of the bigger altnets (alternative network providers) in the UK. The company’s fiber network has reached 2.8 million premises, while the company has more than 400,000 customers.

A deal would also represent further consolidation in the altnet market, which aims to compete with the incumbents such as Openreach and Virgin Media O2.

Virgin Media O2 currently has around 5.6 million customers, and is competing for market share with BT’s Openreach, which aims to hit 25 million premises by the end of next year.

The FT reports that a potential deal would combine Netomnia’s network with VMO2’s own operation and that of Nexfibre, a JV set up by the telco’s shareholders Liberty Global and Telefónica alongside InfraVia Capital.

Netomnia was formed in 2019 and is led by CEO Jeremy Chelot. The company has ambitions to roll out fiber to five million premises by 2027.

Virgin Media O2 is currently pushing to rival BT’s Openreach for its full fiber rollout in the UK, and has passed nearly eight million premises so far. However, it’s still well off Openreach, which has passed more than 20 million with its fiber build.

Along with Nexfibre, which is an independent fiber joint venture between Liberty Global, Telefónica, and Infravia, the separate NetCo and Nexfibre networks will reach a combined total of up to 23 million homes, placing the company in a stronger position to compete with Openreach.

Nexfibre notably completed the acquisition of UK altnet Upp in September 2023 and plans to invest more than £350 million ($461m) in Eastern England by 2026.

It’s not the first time Virgin Media O2 has been linked with a high-profile acquisition of an altnet.

Earlier this year, The Telegraph reported the telco giant was in talks over a move to acquire CityFibre, the biggest of all the altnets in the UK. The FT adds that CityFibre has also approached Netomnia in the past over a merger.

Separately today, Virgin Media O2 announced it has signed a multi-year agreement with SpaceX subsidiary Starlink to provide direct-to-cell services to rural parts of the UK.