Digital 9 Infrastructure (LON: DGI9), an externally managed closed-end investment trust focused on digital infrastructure, today announced that it has agreed to acquire a 48.02% voting stake in Arqiva Group Limited, a UK wireless infrastructure provider of television and radio broadcasting services, as well as connectivity services for UK utility providers. Specifically, Digital 9 Infrastructure is acquiring this stake in Arqiva for £459.3 million ($565 million USD) from Canada Pension Plan Investment Board (CPP Investments).

As a result, CPP Investments’ net proceeds from the transaction, after certain costs and adjustments, are expected to be $455 million USD ($585 million Canadian dollars).

Finally, the transaction is expected to close in the second half of 2022.

Arqiva – Overview

Arqiva is a UK-based data, network, and communications service provider, the sole operator of digital terrestrial television and radio broadcast infrastructure in the UK, and an Internet of Things (IoT) connectivity platform for utilities, including a smart water metering platform in the UK.

Digital Infrastructure

Arqiva owns the following digital infrastructure in the UK:

  • Broadcast Transmission: ~1,450 sites which ensure public service broadcasters (PSBs) can meet their government-mandated coverage obligations to deliver content to UK viewers
  • Satellite Ground Infrastructure: delivering 1,100 TV channels internationally to five continents, via 80 ground stations accessing 30+ third-party owned satellites
  • Internet of Things (IoT) for Utilities: enables smart metering and more efficient network monitoring and management for utility companies. Over 12 million premises connect to Arqiva’s smart meter networks with 50 million data points delivered daily


For the year ended June 30, 2021, Arqiva reported total EBITDA of £332.4 million and net external debt of £1,878.3 million.


Beyond CPP Investments’ 48% sale of Arqiva to Digital 9 Infrastructure, the remaining shares in Arqiva are held by the following investors:

  • Macquarie European Infrastructure Fund II (25%)
  • Other Macquarie Managed Fund (1.5%)
  • Health Super Investments (5.5%)
  • IFM Global Infrastructure Fund (14.8%)
  • Motor Trades Association of Australia (5.2%)

Overall, Digital 9 Infrastructure is acquiring interests in Arqiva which include a shareholder loan. Therefore, this transaction will result in Digital 9 gaining a 51.76% economic interest at current valuation levels, and 48.02% of the equity in Arqiva.

Transaction Overview

Digital 9 Infrastructure’s £459.3 million acquisition of Arqiva will be funded through a combination of £300.0 million in cash, meaning Digital 9’s equity, and a £159.3 million non-recourse vendor loan note. More specifically, Digital 9’s equity component will be financed through the firm’s existing cash resources, including its revolving credit facility.

Investment Rationale

Digital 9 sets out the following investment rationale for its acquisition of Arqiva:

  • Stable cash flows, denominated in British Pound sterling, part of which is regulated by Ofcom, the UK’s communications regulator
  • Weighted average contract length of ~8 years, based on Arqiva’s core contracts that represent 73% of its forecasted revenues in FY22. Additionally, the company has inflation protection against 69% of the revenues it generates
  • Established relationships with customers including the BBC, ITV, Discovery, BT Sport, and Sky
  • Growing national Internet of Things (IoT) platform providing connectivity for utilities

Transaction Advisor

Rothschild & Co served as an M&A advisor in the Arqiva transaction.

Digital 9 Infrastructure – Portfolio

Digital 9 Infrastructure’s acquisition of Arqiva marks the firm’s second investment in the towers/wireless sub-sector of digital infrastructure. To-date, Digital 9 has raised total equity of £845m ($1.0bn USD) and has made the following 7 investments:

  1. Aqua Comms: owns and operates 12.5k miles (20.2k kilometers) of trans-Atlantic and regional subsea cables
  2. EMIC-1: 6.2k mile (10k kilometer) subsea cable and terrestrial fiber system, known as Europe Middle-East India Connect 1, in-partnership with the 2Africa PEARLS system being developed by Facebook (Meta)
  3. Verne Global: data center operator in Iceland with a 24-megawatt campus near the town of Keflavik. Additionally, Digital 9 is scaling the campus to 40 megawatts through a development project
  4. SeaEdge UK1: 10.6-megawatt data center and landing station located in Newcastle, England. Also, the facility connects with the North Sea Connect and NO-UK subsea cables
  5. Host Ireland: enterprise broadband provider in Greater Dublin, which leverages fixed wireless access (FWA) technology, specifically, utilizing high-frequency E-Band spectrum
  6. Volta Data Centres: retail colocation provider focused on the enterprise segment, which operates a 6-megawatt facility in London, UK
  7. Ficolo: data center operator providing colocation services across three data centers in the cities of Helsinki, Pori, and Tampere, Finland
Adam Simmons covers Towers for Dgtl Infra, including American Tower (NYSE: AMT), Crown Castle (NYSE: CCI), SBA Communications (NASDAQ: SBAC), Cellnex Telecom (BME: CLNX), Vantage Towers (ETR: VTWR), IHS Holding (NYSE: IHS), and many more. Within Towers, Adam focuses on the sub-sectors of ground-based cell towers, rooftop sites, broadcast / radio towers, and 5G. Adam has over 7 years of experience in research and writing for Towers.


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