Asterion Industrial Partners, an infrastructure private equity firm, today announced a “significant investment” into MS3 Networks, an alternative fiber broadband provider to homes and businesses in the city of Hull, East Yorkshire, England. Specifically, Asterion Industrial’s capital will accelerate MS3’s plans to build a fiber optic network passing 500k+ homes and businesses in the North of England. Ultimately, MS3 aims to become a major regional provider of fiber-to-the-premises (FTTP) over the coming years.

MS3 Networks – Overview

MS3 Networks is a wholesale-only fiber broadband provider which has operated in the city of Hull since 2013. Presently, the company has an existing fiber ring through Hull and plans to add 30+ other locations in the surrounding region.

Fiber Network

MS3’s existing fiber network comprises 43.5+ miles (70+ kilometers) of underground, wholly-owned duct and fiber. Additionally, according to Ofcom’s Hull Area Wholesale Fixed Telecoms Market Review, MS3 planned to expand its network to reach ~13% of premises across the Hull area by June 2021. Specifically, this equates to ~25k premises passed with fiber in the city of Hull.

Open Access Wholesale Fiber Network

MS3 Networks operates and builds an open access wholesale fiber network. Therefore, MS3’s network is open to all internet service providers (ISPs) and carriers to offer broadband services to end users.

MS3 Networks will supply services to local businesses and national telecommunications providers with a network capable of providing 10 gigabit per second connections.

Management

As part of Asterion Industrial’s announcement, MS3 Networks is completely restructuring its executive-level management team. Firstly, Guy Miller, formerly of TalkTalk joins MS3 as Chief Executive Officer. Secondly, Zarif Imam, formerly of ZTE joins MS3 as Chief Financial Officer. Finally, Chris Byrd, formerly of M247 joins MS3 as Chief Technology Officer.

Going forward, MS3 Networks’ founders Tony Hales and Ben Tarbotton will continue to perform an “active role” in the business.

Financials

As of October 31, 2020, the net book value of MS3 Networks’ fixed assets (i.e., fiber network) was £3.88m ($5.0m).

Ownership

As of October 31, 2020, MS3 Networks was 43% owned by RDS Telecoms Limited and 36% owned by Welch Civils (Mid Wales) Limited.

Transaction Advisors – Asterion Industrial Partners, MS3 Networks

Asterion Industrial Partners’ legal advisor was Gibson, Dunn & Crutcher.

MS3 Networks’ financial advisor was TradeRisks. Additionally, MS3 Networks’ legal advisor was DLA Piper.

Asterion Industrial Partners – Overview

Asterion Industrial Partners is a significant investor in digital infrastructure through its two funds: Asterion Industrial Infra Fund I, which has €1.1bn in equity commitments and Asterion Industrial Infra Fund II, which has €1.5bn in equity commitments. Within digital infrastructure, Asterion Industrial’s investments comprise companies in the major sub-sectors of towers, data centers, and fiber, including:

  • Axión: independent tower company with 635+ sites in Spain
  • Nabiax: operates 15 data centers in Spain, Argentina, Brazil, Chile, United States (Miami), Mexico, and Peru
  • Retelit: wholesale fiber provider with a network spanning 9.9k route miles (16.0k route kilometers) of fiber throughout Italy
  • cableworld fibra: alternative regional telecom provider via fiber networks in southeast Spain

Notably, Asterion Industrial Partners’ investment in MS3 Networks marks its entry into the UK fiber-to-the-premises (FTTP) market.

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