Digital 9 Infrastructure announces managed wind-down strategy to maximize shareholder value

Digital 9 Infrastructure plc (DGI9), a prominent investment trust listed on the London Stock Exchange and part of the FTSE All-Share index, has recently concluded a strategic review, leading to a significant decision to undergo a managed wind-down in a move to enhance shareholder value. This announcement, made on 27 November 2023, marks a pivotal moment for the company, which specializes in investments crucial to the digital economy’s infrastructure.

After extensive consultations with financial advisers and considering feedback from shareholders and institutional investors, the Board of Directors has determined that amending the company’s investment objective and policy to facilitate a managed wind-down represents the most beneficial path forward for all stakeholders. This decision underscores the Board’s commitment to realizing the value of Digital 9 Infrastructure’s assets in a manner that maximizes returns for shareholders.

The company is set to initiate sale preparations for its wholly-owned assets, including Aqua Comms, EMIC-1, Elio Networks, and SeaEdge UK1, with competitive processes expected to launch later this year. Advisers have been mandated to assist with these preparations, indicating a strategic approach to the disposal of assets.

Regarding Arqiva, Digital 9 Infrastructure’s stake in the company presents a unique challenge. The Board’s preliminary review suggests that maximizing the value of this investment may require more time than initially anticipated, leading to a decision to defer the sale process. However, all options that could enhance shareholder value remain on the table, including potential capital markets alternatives.

The managed wind-down process is also anticipated to enable the repayment of outstanding amounts under the Revolving Credit Facility (RCF), following the successful sale of the Verne Global group of companies. Interim Independent Chair Charlotte Valeur emphasized the Board’s dedication to maximizing shareholder value through this process, highlighting ongoing assessments and engagement with shareholders as key components of their strategy.

This strategic pivot by Digital 9 Infrastructure plc is a clear indication of the company’s proactive stance in navigating the complexities of the digital infrastructure investment landscape. By opting for a managed wind-down and focusing on the strategic sale of assets, the company aims to address the discount to Net Asset Value (NAV) affecting its shareholders, ensuring the realization of capital and income value in a manner that aligns with the best interests of all stakeholders involved.

In summary, Digital 9 Infrastructure plc’s decision to undertake a managed wind-down and sell off key assets reflects a well-considered strategy aimed at maximizing shareholder returns. This move not only underscores the company’s adaptability in a rapidly evolving digital economy but also highlights its commitment to acting in the best interests of its shareholders.