Digital 9 Infrastructure (DGI9 ), the worst-performing investment company of 2023, has declared it will wind down and return capital to shareholders just three years after its launch, although it has kept the door open for the retention of one of its key assets, Arqiva.

Charlotte Valuer, interim chair of the board, which has been revamped in recent months, said throughout the strategic review, which was launched in November, the board’s goal has been to ‘maximise shareholder value’.

‘Having carefully considered a number of options, we have ultimately concluded that a managed wind-down of the company is likely the best route to achieve this objective and seek to address the discount to NAV [net asset value] that impacts our shareholders.

DGI shares leaped 3.5p, or 14%, to 28p at the news but remain a fraction of their 116p peak in September 2022 after tumbling 64% last year.

The £889m portfolio of assets run by Triple Point managers Ben Beaton and Arnaud Jaguin has been languishing on an over 75% discount. Shares took a particularly bad hit at the end of September when the 10%-yielder scrapped its payout target and said it would not deliver its second quarter dividend.

The board said it will ‘immediately commence sale preparations’ for its wholly-owned assets, which are subsea fibre systems owner and operator Aqua Comms, a project for subsea cables with Telecom Egypt EMIC-1, wireless connectivity operator Elio Network and datacentre and subsea fibre landing station SeaEdge UK1. It expects to launch a sale process next year.

However, Arqiva, which DGI9 owns with Macquarie European Infrastructure Fund 2 and IFM Investors, is ‘likely going to take longer to realise than other investments’, according to the board.

It said it has decided to defer the sale process and ‘explore various options including capital market alternatives’.

‘The board could reconsider the listing status of the company following completion of the managed wind-down depending on the actions chosen for Arqiva and the Verne Global earn-out at that time,’ the stock exchange notice said.

Verne Global, the company’s most valuable asset, a data centre operator, has been sold and all required approvals for the transaction are on track to complete by the end of March.

French private equity and infrastructure group Ardian will pay $415m (£329m) in cash when the deal closes with a further $25m (£20m) by 26 April, or slightly earlier if Verne enters into a new power agreement, which is also on track.  

A potential earn-out payment could bring in a further $135m (£107m) to DGI9 if Verne achieves unspecified financial targets in the 2026 calendar year.

The deal will allow the company to repay £300m of its £375m credit facility. The board said once the borrowings are fully repaid future proceeds will be split between ‘the repayment of the indebtedness to the vendor in respect of the company’s acquisition of its interest in Arqiva in October 2022 and distribution to shareholders’.

Shareholders will be asked to vote on an amendment to the company’s investment objectives and policy, a circular will be issued in February.

Under the investment management agreement Triple Point needs to be retained until the fourth anniversary, or 31 March 2025, with a 12-month notice period. As such the board plans to issue notice of termination at the end of March this year.

The board added it was ‘actively exploring’ if they could agree to ‘revised commercial terms’ given the company’s wind-down.

The company is due to release a trading update in coming weeks ahead of final year results, which will include an independent valuation on its assets.