In a major shake-up within the UK’s telecommunications sector, Virgin Media O2 has announced a strategic merger of its business division with Daisy Group, forming a £1.4 billion powerhouse aimed at transforming the delivery of telecoms and IT services to UK businesses.
The new entity—yet to be officially named—will be 70% owned by Virgin Media O2 and 30% by Daisy Group, marking a bold step in the consolidation of business-to-business (B2B) telecoms services. The merger is expected to create a formidable player with over 700,000 business customers across the country.
At the helm of this new venture will be Jo Bertram, currently Managing Director of Virgin Media O2 Business, who will take on the role of Chief Executive. Matthew Riley, founder of Daisy Group, will serve as Chairman.
The merger will combine Virgin Media O2’s extensive broadband fibre and mobile network infrastructure with Daisy Group’s strong IT platforms and customer service expertise. Together, they aim to deliver comprehensive communications and technology solutions to businesses of all sizes—from small offices to large corporations and public sector organisations.
Virgin Media O2 CEO, Lutz Schuler, described the tie-up as a “perfect pairing” that would enhance digital transformation for businesses: “Following completion, the new company will have the scale, talent, focus and infrastructure needed to drive digital transformation and provide business customers with an innovative one-stop shop for all their communications and IT needs.”
The merger is projected to yield £600 million in overall cost savings, with around £70 million a year expected by 2030. Over half of these savings should be realised within the first three years, largely through the integration of billing and IT systems.
While specific staffing impacts were not confirmed, Mr. Riley indicated there may be “significant” cost benefits through operational efficiencies. However, he expressed hope that Daisy’s headquarters in Nelson, Lancashire would remain intact.
Daisy Group, which was founded in 2001, currently operates from nine UK locations including Birmingham, Basildon, Bournemouth, Sheffield, London, Sidcup, West Bromwich, Nelson, and Prudhoe. Virgin Media O2 also has business operations in Reading, Manchester, and London’s Paddington area, employing around 16,000 people in total.
Mr. Riley reaffirmed his commitment to the business following the deal, saying: “I don’t want to exit—I want to grow the business. It’s a massive opportunity for me and for Daisy.”
The proposed merger will require approvals from the Competition and Markets Authority (CMA), Financial Conduct Authority (FCA), and the UK Government, due to Virgin Media O2’s involvement in the country’s critical telecoms infrastructure. If cleared, the deal is expected to close in the second half of 2025.
Industry observers say this merger signals a transformative moment in UK business communications and IT services, promising increased competition and innovation in a rapidly evolving digital landscape.
