Macquarie bags KCOM for £627 million

Macquarie Infrastructure and Real Assets (MIRA) has officially closed the acquisition of KCOM for £627 million.

While KCOM has a limited footprint in comparison to rivals, it has created a remarkable leadership position in the Hull and East Yorkshire region. KCOM has been of interest to a number of different suitors over the last few months, since a major profit warning was made last year, though MIRA wins out after an auction process.

“We are pleased to be partnering with an investor that has deep, global expertise in our industry,” said Graham Sutherland, CEO of KCOM. “We are confident that Macquarie Infrastructure and Real Assets will support our long-term growth ambitions whilst helping us maintain our strong local focus and presence.”

“We are looking forward to working closely with KCOM’s management team and workforce to increase fibre accessibility and reduce digital exclusion in the region,” said Leigh Harrison, Head of MIRA EMEA. “By investing to develop and expand KCOM’s networks, we hope to deliver the infrastructure that will underpin growth and innovation in East Yorkshire.”

Last November, KCOM not only issued a profit warning but also cut dividends and warned debts were 10% higher than during the same period of 2017. The news led to a 36% drop in share price and also peaked the interest of potential acquirers.

Virgin Media was first rumoured to be interested in the purchase, it would offer access to an entirely new market for the telco, though pension fund Universities Superannuation Scheme Ltd (USSL) was the first to table a bid. After MIRA got involved in the financial fracas, The Takeover Panel recommended an auction.

With KCOM entering the MIRA portfolio, the investment fund is bolstering its already healthy telecoms position. Aside from KCOM, MIRA is already an investor in Arqiva, and the owner of Danish telco TDC.