Digital 9 Infrastructure Share Discussion Threads

[alan pt] 28/11/2023 18:27

Macquarie was the name that came into my head for an Arqiva sale and funnily enough it seems that they already own the other half

The swaps expire in 27 I think, so if DGI9 are stuck waiting for the possible extra Verne payment until then anyway then might as well wait and sell Arqiva from a stronger position. Sell the rest of the assets in the meantime and potentially pay some special divis

[speedsgh] 28/11/2023 16:10

Digital 9 disappoints again as Verne sale and strategic review point to lengthy wind-down -

[williamcooper104] 28/11/2023 16:00

If the vendor loan note has no change of control then the leverage would be attractive which would help with the sale Otherwise agree that it's going to be the hardest to offload

[cc2014] 28/11/2023 14:44

I've got to ask guys.

In the wind up scenario I can see a buyer for Aqua, EMIC and Sea Edge but I struggle to understand who is going to want to buy Arqiva at any reasonable price.

[williamcooper104] 28/11/2023 14:30

Nothing to be done now But would have been get better to sell everything but Verne and then internalised Verne's management team Especially as we now have to wait for an earn out for nearly 3 years Far better except for Tripple Point of course

[williamcooper104] 28/11/2023 14:18

Rather ominously the talk of the need to cover funding before Verne closes suggests that an equity or more likely some type of short term very expensive debt raise isn't of the cards

[loglorry1] 28/11/2023 14:17

I bought some today but not many and I paid too much in hindsight.

The two big issues seem to be

a) what is the exact EBITDA trigger on the earnout. Clearly they must be targeting way more than $13.5m to be able to sell at the level they sold but investors need visibility on how achievable the real number is.

b) the problem with anything where the NAV is going to take a long time to realise is now being discounted heavily due to better value elsewhere due to higher interest rates. You also no doubt have the manager charging their fees 1-3% of NAV until it is wound down.

If the NAV is 60p because the earn out is unrealistic then a 40% discount doesn't seem unreasonable.

[alan pt] 28/11/2023 13:39

Zero chance of payout now, all the near term proceeds go to pay off most of the RCF and to keep the lights on

If the strategic review outcome is wind down and they sell Aqua comms in 2024 that could be the trigger, but that would be some way off, if it happens

[prokartace] 28/11/2023 13:26

Is there a chance of a payout to shareholders?

[siddiqur2] 28/11/2023 13:14

There's a big buyer about

[wshak] 28/11/2023 12:58

Why on earth hasn't there been a conference call to discuss such a major transaction?

[spectoacc] 28/11/2023 12:46

Lol @Wc104

[williamcooper104] 28/11/2023 12:31

It's like trading the VIX

[siddiqur2] 28/11/2023 12:17

Will close at 44p

[williamcooper104] 28/11/2023 12:15

What's really annoying is the earn out could be anything from almost guaranteed to a remote chance And we don't have a clue with zero guidance So frustrating With the full earn out it's not a bad price Without it's pretty terrible And as shareholders we are none the wiser

[prokartace] 28/11/2023 11:56

CC2014 I have done the opposite and bought

[alan pt] 28/11/2023 11:26

@CC2014 I got to 87p on the lower value, so much the same. Thinking that the higher value is both uncertain and far to far out in the future to really be a factor

Apply a similar 37% discount to CORD and you get to around 55p, or effectively back in the trading range we saw July-Sept

Maybe once the market has time to absorb the details and the early selling wave has passed then it struggles back up there. But can't blame you for not sticking around to find out, this rollercoaster always seem to have another surprise around the corner

[cc2014] 28/11/2023 11:00

DGI9 too stressful for me. At times been sitting on a big loss and then a big profit and in the end out for a half point loss.

[marlint111] 28/11/2023 10:24

My guess is one/more of the major shareholders is using the update and associated high volume as an opportunity to sell down their position.

[speedsgh] 28/11/2023 09:51

Not sue the share price reaction thus far is indicative of investors having a 'degree of comfort' following yesterday's announcement.

[spectoacc] 28/11/2023 08:11

Citywire's take:




"Pietro Nicholls, manager of the RM Alternative Income fund...said the sale price should ‘provide a degree of comfort to the market re valuations’. He pointed out DGI9’s market capitalisation was £372m, less than the £459m it paid for a 48% stake in Arqiva, the UK TV and radio infrastructure group in June 2022, an asset he believed could be the next to be put on the block by Goldman Sachs..."

[cc2014] 28/11/2023 07:29

Current NAV £866m =100.1p

If goes through at higher end NAV reduced to £843m =97.5p
If goes through at lower end NAV reduced to £736m =85.1p

Take the middle value gives 91.3p per share which seems prudent to me as the RNS says they have to meet the target (not exceed it) and given the evidence of the existing ramp up going much better than plan, the target should be delivered.

[marlint111] 27/11/2023 20:45

Yep. Feels like a fair bit of upside still to come.

Question is when the market will adjust- there are still quite a few hoops to jump through and the deal won't complete until middle of next year I guess.

I'm also a but worried about this extra funding they talk about needing. Feels like something that could cause issues!

[williamcooper104] 27/11/2023 20:42

I'm getting to 80p - being $20m deferred consideration and $20m deal fees so extra $30m on Verne or c3p and then another few p for the earn out (clearly that's a guess given how little we've been told about it) Fair share price absent Tripple Point feels like 60-65p and with our general partner managing muppets 50-55p