CityFibre Acquisition Complete, Company De-Lists From AIM
The Acquisition of CityFibre by Connect Infrastructure Bidco positions the company to accelerate the UK’s transformation to a full fibre nation.
The CityFibre shares were acquired by Connect Infrastructure Bidco Limited, a newly formed company indirectly jointly-controlled by a consortium formed by Antin Infrastructure Partners and West Street Infrastructure Partners – a fund managed by Goldman Sachs – was completed on 21 June 2018.
Trading on the Alternative Investment Market (AIM) in CityFibre shares was suspended with effect from 7.30am on 21 June 2018. It is expected that cancellation of CityFibre’s shares admission to trading on AIM shall take effect at 8.00am on 22 June 2018.
CityFibre Acquisition Share Price
CityFibre shares were acquired for £0.81 in cash, a 92.9% premium on the Closing Price of £0.42 per share on 23 April 2018, valuing the entire issued and to be issued ordinary share capital of the company at approximately £537.8 million.
Since 2014, CityFibre has established itself as a leading alternative network provider, delivering wholesale full fibre infrastructure in towns and cities across the UK. The company now has major fibre infrastructure projects across 51 UK towns and cities and has commenced the build of active service platforms across 31 of these locations in readiness for Fibre to the Premises (FTTP) roll-out.
After signing a joint venture agreement with Sky and TalkTalk in April 2014 to trial FTTP in York, CityFibre has completed a number of acquisitions, including £90M for KCOM’s national network assets, adding fibre networks in 24 towns and cities and a national long-distance network to the company’s portfolio.
In 2017 CityFibre also paid £29M to acquire wholesale connectivity provider Entanet Holdings Limited, which serviced approximately 1,500 channel partners in the business and residential markets.
The Future of Fibre
In November 2017, CityFibre secured a 20-year strategic partnership with Vodafone to roll-out full fibre FTTP connectivity to one million UK homes across 12 towns and cities. The agreement with Vodafone provides a framework for expansion to five million homes across approximately 50 towns and cities by 2025. When deployed, this would position the company’s infrastructure across approximately 20% of the current UK broadband market.
The CityFibre board believes the Acquisition will enable CityFibre to deliver meaningful growth and attain a strong market position with the appropriate funding and support. Antin Infrastructure Partners and West Street Infrastructure Partners are supportive of CityFibre’s development, and intend to work with management to accelerate the Company’s national FTTP development, delivering on management’s vision to provide full fibre infrastructure across no less than 20% of the UK.
CityFibre is now positioned as a primary deliverer of the Government’s national full fibre ambition; transforming the digital infrastructure in towns and cities nationwide and unlocking billions in long term economic reward for the UK’s digital economy.
Greg Mesch, Chief Executive of CityFibre, commented:
“Having shaken up the UK telecoms market over the last five years and sparked the race to deliver a full fibre future for Britain, this transaction will enable CityFibre to accelerate our deployment of transformational digital infrastructure still further. These are exciting times, and as the only builder of scale, CityFibre is ideally positioned to make the most of this opportunity to modernise the UK’s digital infrastructure.
“I would like to take this opportunity to thank the shareholders who have supported us since our initial listing on AIM. We have raised over £320m on AIM and believe that without the support of the capital markets, our progress both operationally and strategically would not have been so rapid.”
Philippe Camu, Global Head of West Street Infrastructure Partners and Mark Crosbie, Managing Partner of Antin Infrastructure Partners, said:
“We are delighted to be supporting CityFibre through its next cycle of growth and believe the business is ideally placed to continue to transform the UK telecommunications market. With the need for next generation infrastructure growing at pace, the provision of high quality fibre networks is vital to the ongoing economic development of the UK, and CityFibre sits firmly at the centre of that structural shift.”