Digital 9 Infrastructure Reports £212.9m Arqiva Write-Down, NAV Plunges to 9.3p as Wind-Down Progresses

D9’s 2025 results: NAV slumps to 9.3p as Arqiva is marked to nil and wind‑down moves forward

Digital 9 Infrastructure has released audited results for the year to 31 December 2025. The headline is stark: a £212.9 million fair value loss driven by a reassessment of Arqiva leaves Net Asset Value at just 9.3 pence per share. The Board and InfraRed did, however, make solid progress on the managed wind‑down, paying off all group debt at Holdco level and lining up the first capital return to shareholders.

Key numbers retail investors need to see

Metric	Result
NAV per share	9.3p (31 December 2024: 34.4p)
Total NAV	£80.2 million
Loss on investments at fair value	£212.9 million
EPS	Loss of 25.1p per share
Total return (NAV basis)	(73.0)%
Total shareholder return	(68.8)% (share price 5.9p at year‑end)
Disposals completed in year	£76.7 million (EMIC‑1, SeaEdge UK1, Aqua Comms)
Verne Global earn‑out settlement	£10.0 million cash received post year‑end
RCF	Fully repaid and cancelled
Group cash (year‑end)	£39.3 million (unrestricted)
Weighted average discount rate	14.50%
Compulsory redemption	~3.5p per share, expected by end April 2026

Why NAV collapsed: Arqiva’s equity marked to nil

D9 has written its equity value in Arqiva to nil. This was not about a sudden operational miss. Rather, it reflected:

• Recent minority stake sales by Macquarie‑managed vehicles and IFM to Polus on equivalent economic terms, which the auditors and an independent valuation expert treated as the most reliable datapoints for equity value at year‑end.
• A highly leveraged capital structure and a Vendor Loan Note (VLN) held by the Arqiva vendor. Modest changes in long‑term assumptions can swing equity value sharply when leverage is high. In D9’s case, the equity value fell below the VLN.
• A deliberately conservative refreshed business plan at Arqiva, acknowledging competitive DTT capacity pricing, policy uncertainty and refinancing risk.

The upshot is a nil equity valuation at 31 December 2025. That is disappointing, but the Board still sees potential upside if broadcasting policy, refinancing terms, inflation indexation and efficiencies break in Arqiva’s favour. D9 has strengthened governance at Arqiva, including a new CFO and tighter forecasting, with the realisation targeted after key policy and refinancing milestones, albeit earlier if shareholder value would be better served.

Wind‑down execution: disposals, cash, and the first return

On the execution side, 2025 was productive. D9 completed three material disposals, raising £76.7 million in aggregate proceeds, and used these to fully repay and cancel the Group’s revolving credit facility. The Company then agreed an early settlement of the Verne Global earn‑out for £10.0 million, received in April 2026. Together, completed and contracted cash inflows disclosed total £86.3 million on a net basis.

With the balance sheet de‑risked and liquidity strengthened, the Board expects to complete a first compulsory capital redemption equivalent to approximately 3.5 pence per existing share by the end of April 2026. That is funded by Aqua Comms proceeds alongside the Verne settlement, after retaining an appropriate working capital reserve.

The portfolio is now just two assets

Arqiva: essential network, valuation reset

D9’s economic interest is 51.76%. On a D9 share of Arqiva, revenue was £375 million and EBITDA £162 million for the twelve months to 31 December 2025, with margin pressure from competitive DTT pricing and mix. The valuation reset reflects market evidence and the capital structure, not a collapse in service delivery. Note also the inflation‑linked swaps: accretion of £43.2 million in 2025 and an estimated £43.6 million in 2026, of which about £22.5 million relates to D9’s pro‑rata interest, all funded from Arqiva’s internal cash flows.

Elio Networks: steady progress and optionality

Elio, which D9 owns 100%, delivered revenue of £8.5 million and EBITDA of £4.1 million, ahead of plan, with a 48% margin. InfraRed has been hands‑on, including running a new debt raise in‑house. Post year‑end Elio secured a €15 million committed facility plus a €15 million accordion to support disciplined buy‑and‑build. No value is booked for potential M&A, but Elio’s organic and inorganic growth potential is a rare bright spot that the Board intends to cultivate before sale.

Debt, VLN and liquidity: what sits above and below the line

• At the D9 level, the RCF is gone. The Group ended 2025 in a net cash position of £39.3 million.
• The Vendor Loan Note linked to Arqiva was £197.6 million including accrued interest at year‑end. It is non‑recourse to the rest of the Group, with interest rolling up at stepped rates to maturity on 18 October 2029. Distributions up from Arqiva require VLN interest to be current, and after 18 October 2026, both principal and interest must be fully repaid before distributions.
• A provision relating to potential additional VLNs tied to Bilsdale restoration was recognised at Holdco level. The quantum is commercially sensitive and not disclosed.

Positives and negatives in plain English

What I like

• Execution discipline: three disposals done, RCF fully repaid and cancelled, and an earn‑out settled for hard cash.
• Liquidity first: £39.3 million of unrestricted cash at year‑end gives optionality during the wind‑down.
• Real money back: the first compulsory redemption around 3.5p per share is imminent, with a mechanism now in place for further returns.
• Elio momentum: revenue and EBITDA growth, plus a flexible debt facility to support value‑accretive consolidation.

What worries me

• Arqiva valuation at nil: this is the single biggest driver of the NAV collapse and will likely keep sentiment fragile until there is clarity on broadcasting policy and refinancing.
• VLN overhang: although non‑recourse to the wider group, it sits ahead of equity and caps distributions from Arqiva.
• High ongoing charges ratio at a much smaller NAV base: 2.4% for 2025.
• Shareholder pain: total shareholder return was down 68.8% over the year, mirroring the steep NAV drop.

Governance and housekeeping you should note

• A prior year adjustment of £111.5 million was recognised for 2023, mainly an overstatement of Aqua Comms’ valuation and an omitted VLN provision. Opening 2024 reserves were reduced accordingly.
• On 9 April 2026, the Financial Reporting Council opened an investigation into PwC’s audit of the 2023 financial statements.
• Discussions with the previous manager, Triple Point, over cessation fees are ongoing. A £0.8 million release of previously accrued fees was recognised in 2025, but this does not settle the dispute.

What to watch next

• Capital returns cadence: after the initial ~3.5p redemption, look for further distributions as realisations progress and working capital needs fall.
• Broadcasting policy and BBC charter developments: key determinants of Arqiva cash flows post 2030 and, by extension, any future equity value recovery.
• Arqiva refinancing roadmap and contract renewals: milestones that the Board has flagged as the right window for an exit, subject to value.
• Elio execution: use of its new debt facility for disciplined M&A, and whether growth continues to lift valuation.

My take

This update is a tale of two tracks. On one track, InfraRed and the Board are doing the right things for a wind‑down: sell assets, pay off debt, bank cash, and start returning it. On the other, Arqiva’s market‑anchored valuation and the VLN structure have crushed NAV and sentiment.

From here, the story becomes tactical. Shareholders should now expect the company to focus on delivering a sequence of redemptions, actively manage Arqiva through policy and refinancing uncertainty, and keep Elio on its current growth path to maximise exit value. It is not pretty, but there is a clear plan. The prize from here is steady capital back, plus any optional upside if Arqiva’s operating and policy backdrop improves over time. As ever, timing and execution will decide how much of that upside, if any, makes it to equity.