VMO2 weighs ‘junk’ debt options
July 30, 2026
Virgin Media O2 are weighing options to cut its £22 billion (€25.6bn) debt as investor nerves have seen a spike sell-off in its bonds.
Options for owners Telefónica and Liberty Global include cutting VMO2’s expected £200 million dividend this year, shedding jobs and reducing capital expenditure, according to FT reporting.
The price of VMO2’s roughly £1.1 billion of senior unsecured debt has plummeted, with one $925 million bond falling as low as 57 cents on the dollar on July 29th, having traded at about 78 cents at the start of July. VMO2’s safer senior secured bonds have also fallen sharply, with the price of a $1.4 billion note reaching 76 cents on the dollar, down from 92 cents at the beginning of the year.
The company has become a focal point for investors in Europe’s junk debt market, with one distressed credit investor describing VMO2 as “the talk of the town right now”.
Bondholders have been spooked by the threat posed by the dozens of small fibre network operators (altnets:, which raised more than £31 billion to lure customers from VMO2 and BT-owned Openreach with cheap fibre broadband.
Virgin shed 33,500 broadband customers in the first half of 2026, on top of the 138,400 it lost last year. It had a customer base of 5.42 million at the end of June.
Liberty Global chief executive Mike Fries urged investors to remember that VMO2’s shareholders had “many tools” at their disposal “if necessary” to cut the company’s debt, boost operating performance and improve free cash flow — “both organic and inorganic”.
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