Sky News understands that AlixPartners and Houlihan Lokey, the restructuring firms, have been enlisted to work on a potential recapitalisation of Airband Community Internet, which serves counties including Devon, Shropshire and Oxfordshire.

City sources said Airband had been working on financing options for several weeks and was likely to require a substantial injection of new capital.

The company is backed by Abrdn, the fund management group, and Amber Infrastructure Group.

In November 2021 it announced that it had secured a £100m debt facility, saying it would help accelerate Airband's rollout to 600,000 premises by 2025.

Airband could not be reached for comment on Tuesday.

Its search for new funding comes amid broader strains on the altnet sector.

Sky News revealed last month that Broadway Partners, a rural network builder in Scotland and Wales, had been forced to call in administrators.

Broadway had set an ambitious target of connecting 250,000 homes and businesses by 2025, and insolvency practitioners at Teneo are now running a process to sell its business or assets.

Other fibre network builders which have sought new investment or buyers in recent months include Trooli, another mid-sized entrant.

The market is dominated by BT's Openreach division, but also includes large competitors such as CityFibre Holdings.