When a company borrows heavily and never turns a profit, the person who put up the money can end up holding the keys. That's what is happening at Toob.
Ares Management is a private credit firm. That means it lends money directly to businesses, rather than through a traditional bank. It was already Toob's senior lender, so it stood first in line to get repaid if things went wrong.
Toob sits under the National Digital Infrastructure Fund, which is backed by the UK government's National Wealth Fund and by INPP, an investment company that trades on the stock market. The fund is managed by Amber Infrastructure Group. It simply didn't want to invest any more.
The handover is expected to be completed by August 17, 2026.
Toob is what the industry calls an alt-net, an alternative fiber network. Instead of renting space on the big national grid, it built its own fiber lines to compete with the company. That is a hugely expensive project, and it is why so many of these providers grew fast and then got stuck.
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In 2023, Ares backed Toob with a credit facility worth about £160 million. The money helped the company grow, but it still isn't making a profit.
A business like that needs constant new funding to live. When financing costs rise, that funding gets very hard to find.
The entire sector is now preparing for a wave of consolidation. Plenty of these operators will merge, sell assets, or restructure their loans. Toob has just become a name on that list.
Many of these businesses were built on borrowed money during the cheap-money era. They used that capital to build networks and grow quickly, but heavy upfront costs left them dependent on constant refinancing. Now that financing costs have climbed, their business models are under pressure.
The National Wealth Fund, which backs the National Digital Infrastructure Fund behind Toob, is in the same boat. This year it also felt the pain in another fiber player, Gigaclear. The National Wealth Fund joined other creditors to take over Gigaclear after accepting a reduction on a debt load of near-£1 billion.
A National Wealth Fund representative said the industry will keep changing and consolidating. "The fund's goal is to limit its exposure, keep its policy goals in mind, and still get good value," he added. In other words, taxpayer money is not being left to "sunk costs".
These deals may be quiet, but their impact is not contained. Private credit firms like Ares manage money for giant funds, insurers, and pensions that can sit inside your own portfolio. When a loan goes wrong, the losses can reach investors who are far away from the company name.
For most people, the more direct story is about the era of cheap money coming to a real end. For years, high-risk companies borrowed at near zero cost and grew. Now the bill has arrived, and Toob is one example.
The underlying problem is that when money costs nothing, everyone wants to be an owner; when it becomes expensive, everyone wants to be on the lender's side. Toob's takeover is just that: the bigger financial order always wins.
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