Infracapital has made the first investment from the Digital Infrastructure Investment Partners fund with a £35 million ($45.9 million; €39.6 million) deal for broadband provider WightFibre.
The firm said it had acquired the broadband operator to help fund a full-fibre, ultrafast broadband network across the Isle of Wight. WightFibre said the deal will create a “Gigabit Island” and will provide some of “the fastest broadband speeds in the world”.
The move represents the maiden project funded by the DIIP fund, managed by Infracapital and internet infrastructure merchant banking specialist Cameron Barney on behalf of the UK government. The fund is looking to raise £200 million from institutional investors in a bid to accelerate full-fibre broadband in the UK.
The fund is running alongside the National Digital Infrastructure Fund, managed by Amber Infrastructure, which will seek to make debt and equity investments as well as a debt-only fund managed by Infracapital’s parent M&G Investments.
The acquisition of WightFibre is partially supported by Infracapital’s greenfield fund, which is targeting around £1 billion and is expected to close imminently. WightFibre is the fund’s third broadband deal following a joint venture with Nokia in Poland and an investment in UK rural provider Gigaclear.
The move also represents Infracapital’s return to the island following its sale of Isle of Wight ferry company Red Funnel in June to UK and Canadian pension schemes.