Backlash over Mikhail Fridman £1bn UK broadband bet

Campaigners have called for greater scrutiny over foreign investment in the UK telecoms market after a Russian oligarch backed a £1bn plan to upgrade the country’s broadband network.

Letter One, an investment company founded by billionaire Mikhail Fridman, is a key investor in a project by new broadband firm Upp to deploy full-fibre connections in the east of England.

The company, which owns Holland and Barrett, is providing equity financing for the project, which aims to reach 1m premises by 2025.

Fridman was named in a leaked dossier compiled by former British spy Christopher Steele, who accused him of having close ties to Russian President Vladimir Putin — allegations he denied.

The oligarch was one of three Russian billionaires who won a High Court libel case against Steele’s corporate intelligence consultancy Orbis over the claims.

There is no suggestion that either Fridman or Letter One have done anything wrong.

Nevertheless, his move into critical UK telecoms infrastructure has raised eyebrows among politicians and think tanks.

Conservative MP Bob Seely told the Telegraph: “I do think in the UK, if we’re serious about pushing back on potential malign influence, we need to be very careful. I do not understand what is happening in this case.”

James Sullivan, cyber research director at defence think tank Rusi, said: “Western governments are still coming to terms with foreign entities having a controlling stake in their critical national infrastructure, including telecommunications networks.

“You have a process in the UK where there is a framework for identifying high-risk vendors. That framework should also include the background of companies, the practices of individuals and whether they are on sanctions lists.”

UK broadband push

The investment comes after a ban on Huawei building the UK’s 5G network has forced telecoms companies to spend millions of pounds ripping out existing equipment made by the controversial Chinese tech firm.

The move has led a new vendor diversity task force, set up by the government, to call for more smaller telecoms suppliers to contribute to the country’s networks to reduce reliance on a handful of companies.

Upp, formerly known as Fibre Me, is pumping £1bn into its East Anglia broadband plan as it looks to challenge the dominance of BT.

The former state monopoly last month upgraded its full-fibre broadband rollout targets and is now aiming to reach 25m premises by the end of 2026.

Upp chief executive Drew Ritchie said: “Mikhail Fridman is one of several minority shareholders in Letter One, which is an investor in Upp.

“The company is managed by a very experienced British management team with knowledge of how to build a secure network in the UK. All necessary regulatory processes have been followed in establishing a provider of telecommunication services in the UK.”