Infracapital agrees to acquire majority stake in Welsh broadband provider Spectrum

Summary:

  • Spectrum will provide gigabit-capable broadband to market towns and rural villages
  • Spectrum is targeting an addressable market of over 150,000 premises across SouthWales
  • Investment expected to create 140 jobs and support substantially more in theconstruction sector during roll-out

Infracapital, the infrastructure equity investment arm of M&G Plc, has signed an agreement to acquire a controlling interest in Spectrum, an owner and operator of fibre networks in Wales. Infracapital will invest in the business, alongside management, and support the business to realise its ambition to build the leading alternative network in South Wales. The initial investment will provide funding for its continued commercial fibre roll-out, which will initially reach over 150,000 homes and businesses. The investment is also expected to directly create 140 jobs as Spectrum expands its headquarters and operations staff in Wales to support the network buildout.

Spectrum focuses on providing high-quality broadband connectivity to homes and businesses currently suffering with low average broadband speeds in South Wales. The company is well known in Wales as a broadband services provider and is committed to working closely with the communities it serves.

The UK, and Wales in particular, is currently one of Europe’s most underserved fibre markets. This presents a significant opportunity for Infracapital, drawing on its extensive experience in fibre roll-out across the UK and Continental Europe, adding to Infracapital’s existing fibre portfolio in the UK which includes Gigaclear, SSE Telecoms, Wightfibre and Fibrus. Infracapital will support Spectrum as it enters its next phase of growth to deliver critical infrastructure to homes and businesses across South Wales, creating jobs locally to deliver construction of the network and network operations once built.

This acquisition follows Infracapital’s recent investment in Fibrus, a Northern Ireland based broadband provider, another off-market fibre opportunity funded through Infracapital’s greenfield strategy. Infracapital’s greenfield strategy seeks to build, deliver and operate essential and sustainable infrastructure across Europe. As the world transitions to an increasingly digital economy, there is a growing need for new-build infrastructure, in particular fibre broadband, to meet the changing needs of society and support long term economic growth. This investment is being made together with Digital Infrastructure Investment Partners, a platform focused on investment opportunities in UK full-fibre broadband infrastructure.

Andy Matthews, Head of Greenfield at Infracapital, said:

“Spectrum is an excellent opportunity for us to deliver an essential service to society, in tandem with creating jobs in the region and delivering value to our investors. We see expanding fibre connectivity as a critical component in building a more sustainable and resilient economy, particularly in the context of Covid-19, and we are excited to be playing our part in making this accessible across South Wales”

Giles Phelps, Spectrum Founder said:

"I am delighted that Spectrum has secured the expert backing of Infracapital for our ambitious plan to bring full fibre broadband to the communities of South Wales. Infracapital's financial support, knowledge and experience will allow Spectrum to deliver a high-quality service to thousands of families and businesses, and play a key role in Wales's economic recovery, job market and digital transformation at this crucial time."

ENDS

About Infracapital

Infracapital invests in, builds and manages a diverse range of essential infrastructure to meet the changing needs of society and support long-term economic growth. We take an active role in all of our investments, whether nascent or large, to fulfil their potential and ensure they are adaptable and resilient. Our approach creates value for our investors, as we target investments with the scope for stable and sustainable growth. Our portfolio companies work closely with the communities where they are based, to the benefit of all stakeholders. Infracapital is well positioned to deliver the significant investment required to help build the future. The founder-led team of experienced specialists has worked with more than 50 companies around Europe and has raised and managed over £6.5 billion of client capital across six funds.

Infracapital has significant experience in the telecoms sector and manages a portion of the UK Government’s Digital Infrastructure Investment Fund supporting the nationwide roll out of high speed fibre.

Infracapital is part of M&G Plc, a leading European savings and investments business. M&G manages the long-term savings of more than 5 million people and is a major investor in the UK and in the global economy. Total assets under management are £339 billion (as at 30 June 2020).

www.infracapital.co.uk

About Spectrum

Established by Welsh tech entrepreneur Giles Phelps in 2011, Spectrum Internet has delivered high quality broadband and internet services to businesses and homes in the cities of Cardiff, Newport and Bristol, as well as rural communities across south Wales and the west of England. Mr Phelps will form part of a new Senior Management Team that has been established to grow the company following the investment.

www.spectruminternet.com

Media enquiries

If you require any further information, please contact:

Infracapital
Tulchan Communications
Tom Murray / Nick Laitner/ Amber Ahluwalia tel. +44 20 7353 4200  

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