INFRASTRUCTURE

Digital

Broadband has been identified by central and local governments as a key facilitator of economic growth and social inclusion, as society’s transition to the knowledge economy continues.

There is also huge consumer-led demand for quality provision – preferably on a fibre to the home “FTTH” basis for optimum speeds.

The scale of investment required to meet this demand and deliver fibre broadband throughout the UK and Europe is huge. Fortunately, investors and senior lenders are increasingly viewing broadband as a core infrastructure asset. While it may be exposed to market risk in terms of pricing, effectively structured projects or commercial network roll outs provide investors with exposure to an established technology, barriers to entry and attractive long-term returns.

Various commercial structures are prevalent in the sector. These can range from projects involving some state intervention (capex subsidies or availability-based payments) to fully commercial deployments, which are typically viable in more densely populated areas. Our team has experience in both respects – having advised a bidder on the Scottish Government’s R100 project to connect the last 5% of premises without high-speed access, and also developed financial models to support commercial network roll out in other regions of the UK. If you may require financial modelling, assistance in developing a deployment strategy or engaging with funders and equity investors in this sector we would be pleased to discuss further.