TIDMJLG
RNS Number : 2155U
John Laing Group plc
01 April 2021
1 April 2021
INVESTMENT UPDATE
John Laing invests in German fibre platform
John Laing Group plc ("John Laing" or the "Group"), the
responsible investor and active manager of infrastructure projects
internationally, announces that it has executed binding agreements
to acquire two regional German businesses (the "Transaction"), in
order to create a single platform (the "Platform") to invest in
fibre-to-the-premises ("FTTP") in Germany.
The Transaction comprises the acquisition of 100% shareholdings
in two regional and complementary telecommunications businesses,
located in southern and western Germany. These businesses are EFN
eifel-net Internet-Provider GmbH and Jobst NET GmbH, and each is in
the early stages of FTTP roll-out programmes, focusing on
delivering connectivity to under-served suburban and rural
communities in Germany. Each business brings key relationships and
over a decade of experience and track record of managing
telecommunications networks, planning roll-out clusters, deployment
and capturing of subsidies in rural areas. Together, with the
management teams of these businesses, John Laing will create a
single integrated Platform through which to invest further in
rolling out FTTP.
John Laing has committed a total investment of up to EUR30
million (up to approximately GBP27 million) to acquire control of
these two businesses and to fund the initial investment in fibre
roll-out programmes over the next 12 months. Given the potential
growth of the roll-out strategy, this Platform represents a
material opportunity for further investment by John Laing over
time, and which could represent a total equity investment in excess
of EUR100 million over the next three years.
This investment fits with John Laing's strategy of investing in
businesses and platforms with growth potential, and which are asset
intensive and provide essential infrastructure. This Platform is
expected to grow materially through the rolling-out of fibre
networks in underserved communities. Importantly this roll-out
programme involves a significant greenfield construction component,
which aligns well with John Laing's core greenfield expertise and
capabilities.
During the roll-out and construction phase, John Laing will
support the management team by leveraging its expertise in
developing and financing greenfield infrastructure and actively
working with construction partners and other stakeholders.
FTTP is the fastest and most reliable internet connectivity
solution available and is critical to facilitate the strongly
growing internet bandwidth demands of the future. Germany is
currently one of the most attractive growth markets for fibre in
Europe, with FTTP penetration rates that are materially lower than
other countries in Europe, at around 10% - compared to Spain,
Portugal and Norway where penetration rates are around 40% or more;
others such as France, Denmark and the Netherlands have penetration
rates of at least 25% [1] . The regulatory regime in Germany is
supportive, with government-backing for fibre roll-outs that
include subsidies as well as a national deployment target. Digital
connectivity is fundamental to the achievement of many of the UN's
Sustainable Development Goals, and deployment is key to the German
government's ambitions to improve digital access. Fast, reliable
and cost-effective broadband will ensure a more inclusive future
for local communities and support economic development, including
through the creation of jobs in the construction and operation of
the network.
Dr. Jürgen Hernichel, who has worked closely with John Laing on
the Transaction, has been appointed by John Laing as Chief
Executive Officer of the Platform. Dr. Hernichel brings over 25
years of telecommunications experience, including as Chief
Executive Officer of Colt Germany, Deutsche Telekom/T-Systems
International and 1&1 Versatel.
The John Laing investment team in Germany is being led by Ronny
Juch, who has spent more than a decade working in the German
telecommunications and fibre sectors with organisations such as
Deutsche Telekom, 1&1 Versatel, Deutsche Glasfaser and Teutel
where he built up several FTTP networks, mainly in rural areas.
Ronny has been appointed to the Platform's Board.
Dr. Hernichel and Ronny will work together with the existing
management teams of the acquired businesses, as we develop and grow
the Platform.
Commenting, John Laing's Chief Executive Ben Loomes said:
"We look forward to working together with the management team to
accelerate the rolling out of high-speed internet access across
underserved communities across Germany, and contributing to the
German government's plan to deliver nationwide gigabit internet
access by 2025.
Through this transaction, we are investing in a scalable
platform which is building essential digital infrastructure in
Germany, which is currently among the countries in Europe with the
lowest level of fibre-to-the-premises connectivity and which will
require significant future investment.
The pandemic and lockdowns have meant that our reliance on
digital connectivity has never been greater, and has accelerated
the transition to a more digital economy. We believe that the
development of fibre-to-the-premises connectivity will play a key
role in enabling digital inclusion and sustainable economic
growth.
Across the John Laing Group, we have seen a good pick-up in
investment momentum in 2021. Total investment commitments in the
first quarter of this year amount to GBP59 million, which is
greater than the total annual level of investment commitments in
2020 of GBP43 million. Currently, we have an additional investment
pipeline in 2021 of approximately GBP160 million of aggregate gross
investment commitments, where we are in exclusive, preferred or
short-listed positions."
Analyst & investor enquiries:
Kellie McAvoy Head of Investor Relations +44 (0) 7923 249298
Media enquiries:
Tashi Lassalle Director of Communications +44 (0) 7923 249384
Tulchan:
+44 (0) 20 7427
Olivia Peters 5494
About John Laing
John Laing is a leading international investor across a range of
infrastructure sectors. We seek deliver attractive and sustainable
returns over the medium-term. We are a responsible investor,
committed to delivering critical and enduring infrastructure which
responds to public needs and improves the lives of the communities
we serve.
About EFN eifel-net Internet-Provider GmbH
EFN is a full-service provider offering mainly VSDL internet
services to retail and business customers in rural areas and towns,
predominantly in North Rhine-Westphalia, with a further presence in
Rheinland-Pfalz and Baden-W ürttemberg in the western and southern
part of Germany. The company was founded in 1991 and currently has
a network covering approximately 13,000 homes passed.
About Jobst NET GmbH
Jobst NET is a full-service provider offering mainly VSDL
services to retail, business customers and housing associations in
the northern part of Bavaria, Germany. The company was founded in
2008 and currently has a network covering approximately 10,000
homes passed.
ENDS
[1] Source: IDATE for FTTH Council EUROPE
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