17th Jan 2025 16:23
(Alliance News) - Digital 9 Infrastructure PLC on Friday said it has struck a deal to sell its Atlantic and Irish Sea subsea fibre business, Aqua Comms, to EXA Infrastructure for USD54 million.
The London-based investor in internet infrastructure, such as data centres and subsea fibre said the value of the transaction represents a 28% discount to the USD75 million valuation, as at June 30.
Aqua Comms was valued at USD283 million in December 2023, before the USD208 million write-down in June.
Shares in Digital 9 were down 26% to 14.93 pence in London on Friday afternoon.
Digital 9 said this "reflected the inability to fund the Asian growth projects", margin compression and "the indicative interest received" in a sales process.
"Since then, the market backdrop for selling Aqua Comms has softened as further reflected in the transaction price achieved," Digital 9 said.
Digital 9 said it expects to receive net proceeds of USD48 million, representing a 36% discount to the valuation in the net asset value in June.
The company said it has been advised that delaying a sale is unlikely to materially increase the price within the timescale of the wind-down.
The transaction is subject to multi-jurisdictional regulatory approvals, which Digital 9 expects to take around 12 months.
Chair Eric Sanderson said: "While the pricing outcome for Aqua Comms is extremely disappointing and less than might have been expected for the Company, a complete and far-reaching auction process has been run over a period of nine months, to fully market test the value of this business. Given the current market conditions and business specific factors, we are confident this transaction represents the best option for shareholders in the context of the orderly wind-down."
By Michael Hennessey, Alliance News reporter
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