Acquisition of stake in wireless comms network
13 January 2022
DIGITAL 9 INFRASTRUCTURE PLC
("D9", the "Company" or, together with its subsidiaries, the "Group")
Acquisition of majority stake in Irish wireless communications network
The Company is pleased to announce that its wholly owned subsidiary, Digital 9 Wireless Limited ("D9 Wireless"), has signed a conditional SPA to acquire a majority stake (56%) in the exclusive operator of public safety wireless networks across the Republic of Ireland ("RoI"), Tetra Ireland Communications Limited ("TETRA Ireland") (the "Acquisition") for a total consideration of approximately €76 million. The Company may also have the opportunity to increase the acquisition up to a 100% holding, which would increase the total consideration to approximately €136 million.
As a result of this transaction, D9 has now deployed or committed substantially all of its available capital.
Key highlights:
· TETRA Ireland is the exclusive operator of public safety communication networks across the RoI, having been mandated by the Government of the RoI in 2006 and contractually renewed in 2020. TETRA Ireland owns and operates the National Digital Radio Service ("NDRS"), a purpose-built, secure, digital mobile network, developed using "Terrestrial Trunked Radio" technology.
· TETRA Ireland's network provides a high reliability and mission critical infrastructure service across the RoI, providing >98% geographic coverage (including offshore, mountainous regions and remote rural locations), with an historical 99.97% network uptime and 24/7 customer care. Compared to traditional commercial mobile network service, the TETRA Ireland network provides a higher level of security, resilience and redundancy in even the most rural areas which is required for public safety and emergency services.
· c.97% of TETRA Ireland's customer base are RoI Government public bodies, comprised of c. 70 agencies with some 24,000 active subscribers principally across emergency services, local government and public services, including the police, ambulance services, the Irish Coast Guard, fire services and the Irish Prison Service.
· Pricing and service terms for usage by TETRA Ireland's customers are guaranteed by long-term, inflation linked contracts with the Government of the RoI.
· The expected underlying earnings of this transaction are highly supportive of the Company's dividend policy.
· The Company has signed a conditional sale and purchase agreement ("SPA") to acquire a majority stake (56%) in TETRA Ireland from eircom Limited ("eircom"). D9 Wireless has secured a commitment from the Company to allocate, in aggregate, €135.7 million for the acquisition of up to 100% of TETRA Ireland, subject to contract with any other selling shareholders.
· The Acquisition is D9's first investment into wireless infrastructure, one of the Company's four target digital sub-sectors. The opportunity is in line with the Company's focus on UN Sustainable Development Goal 9 with TETRA Ireland providing resilient, mission critical communications infrastructure which supports users ranging from volunteer groups to national emergency services, connecting public services and communities across the RoI.
Thor Johnsen, Head of Digital Infrastructure at Triple Point, commented:
"We are pleased to have entered into an agreement to acquire a majority stake in TETRA Ireland and will continue to responsibly support and enhance the mission critical and essential national wireless infrastructure services TETRA Ireland provides. The acquisition is highly attractive and complementary to the growing D9 portfolio of digital infrastructure assets, providing additional long-term contracted, inflation-linked cash returns to investors. TETRA Ireland is an essential part of the Irish national wireless infrastructure today and looking to the future, and we look forward to working with the TETRA Ireland management team and key stakeholders.
The Acquisition results in another milestone for the Company - substantial full deployment or commitment of the £750 million equity proceeds raised to date."
FOR FURTHER INFORMATION ON THE COMPANY, PLEASE CONTACT
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Triple Point Investment Management LLP (Investment Manager) Thor Johnsen Andre Karihaloo
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+44 (0) 20 7201 8989 |
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J.P. Morgan Cazenove (Corporate Broker) William Simmonds Jérémie Birnbaum
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+44 (0) 20 7742 4000 |
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Akur Capital (Financial Adviser) Tom Frost Anthony Richardson Siobhan Sergeant
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+44 (0) 20 7493 3631 |
LEI: 213800OQLX64UNS38U92
NOTES:
Digital 9 Infrastructure plc is an investment trust which invests in a range of digital infrastructure assets which help to deliver, inter alia, a reliable, functioning internet.
The Company's portfolio will comprise scalable platforms and technologies including (but not limited to) subsea fibre, data centres, terrestrial fibre, tower infrastructure and small cell networks (including 5G).
With its IPO in March 2021, to date, D9 has raised total equity of £750 million, investing the net proceeds into data centres and fibre networks :
· Aqua Comms, a leading owner and operator of 20,000km of the most modern subsea fibre systems - the backbone of the internet - with a customer base comprising the hyperscalers and global carriers (April 2021);
· EMIC-1, a partnership with a hyperscaler on a 10,000km fibre system from Europe to India (July 2021);
· Verne Global, the leading Icelandic data centre platform, delivering high intensity computing solutions to its enterprise customers in a geographically optimal environment, powered by 100% renewable power - one of the most efficient data centres in Europe (September 2021);
· SeaEdge UK1, a data centre and the UK's only landing station for the North Sea Connect subsea cable, part of the North Atlantic Loop subsea network, which includes D9's AEC-1 and AEC-2 cables, improving connectivity between the UK, Scandinavia and North America (December 2021)
The Investment Manager is Triple Point Investment Management LLP ("Triple Point") which is authorised and regulated by the Financial Conduct Authority, with extensive experience in asset and project finance, portfolio management and structured investments. The Investment Manager's digital infrastructure team has a proven track record of over US$3 billion of infrastructure investments and, in addition, benefits from a panel of digital infrastructure industry experts with deep knowledge, relationships and involvement in a combined US$250 billion of digital infrastructure transactions.
The Company is focused on the provision of Digital Infrastructure integrated with green and cleaner power in line with UN Sustainable Development Goal 9: "Build resilient infrastructure, promote inclusive and sustainable industrialization and foster innovation".
The Company's Ordinary Shares were admitted to trading on the Specialist Fund Segment of the Main Market of the London Stock Exchange on 31 March 2021.
For more information, please visit www.d9infrastructure.com .
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