Digital 9 Infrastructure plc (LSE:DGI9) has indicated that the value of its equity interest in UK broadcast and communications operator Arqiva Group Limited may now sit below the level of its associated vendor loan note. If confirmed, this would result in a nil valuation for the stake in the trust’s 31 December 2025 net asset value.

The anticipated reduction reflects weaker long-term planning assumptions at Arqiva, alongside comparable third-party transaction evidence. In particular, a recent disposal by Macquarie Group Limited implied a valuation beneath the outstanding loan note, reinforcing pressure on the carrying value of Digital 9’s position.

The board emphasised that the final assessment remains subject to completion of an independent valuation exercise, external audit procedures and formal approval. It also noted that potential upside could still emerge depending on Arqiva’s operational delivery, future contract renewals, regulatory developments and any optimisation of its capital structure.

Even so, the update underlines the binary nature of D9’s exposure to Arqiva and the impact that regulatory or market-driven outcomes can have on portfolio value. A write-down to zero would represent a significant reduction in NAV as the trust progresses with its managed wind-down strategy for shareholders.

From a performance standpoint, the investment case is weighed down by weak recent financial metrics, including substantial losses, negative revenue and declining equity levels, alongside volatile cash flows. Technical indicators also suggest downside momentum, with the share price trading below key moving averages and momentum signals remaining negative. Valuation appears neutral given the absence of meaningful earnings or dividend data.

More about Digital 9 Infrastructure plc

Digital 9 Infrastructure is a London-listed investment trust and constituent of the FTSE All-Share, focused on digital infrastructure assets. The company is currently undertaking a managed wind-down designed to realise value from its existing portfolio in an orderly manner.

InfraRed Capital Partners, which oversees approximately US$13 billion of equity capital, acts as the trust’s alternative investment fund manager and adviser throughout the wind-down process.

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