Digital 9 Infrastructure (DGI9) shares fell nearly 30% yesterday after the company said Macquarie European Infrastructure fund had sold its 26.5% stake in Arqiva, the UK broadcasting platform for £16.5m, as part of its liquidation. The price is well below the £213.2m valuation of DGI9’s 51.8% stake in Arqiva. DGI9, whose wind-down is being managed by InfraRed Capital Partners, said the valuation was “highly sensitive” to the outcome of the Department for Culture Media & Sport’s consultation on the future of TV distribution, broadcasting contract renewals and the refinancing of its capital structure. It said InfraRed would carry out the 31 December valuation for the portfolio, including Arqiva, in due course. DGI9 shares have plunged 93% in the past three years. They regained 0.5p, or 8%, to 6.2p today.
Schroder UK Mid Cap (SCF), a £230m trust under pressure from 15%-owning activist Saba Capital, outperformed in the year to 30 September. The portfolio of mid-cap stocks managed by Schroders’ Jean Roche achieved a 10.8% total investment return that beat the 4.1% return form the FTSE 250 index (excluding investment companies). Shareholders did better with an 18% total return as the share price discount narrowed in response to the launch of buybacks and the promise of a continuation vote in 2028. A final dividend of 16.1p per share brings the total payout for the year to 22.4p, up 4.2% on last year and covered by 25p earnings per share.
Schroder Real Estate (SREI), the £267m UK generalist REIT being stalked by LondonMetric Property (LMP), struck an upbeat note in half-year results. Chair Alastair Hughes said the board and Schroders fund manager Nick Montgomery looked forward to a sector rerating next year following the end of Budget uncertainty yesterday. “Real estate fundamentals remain strong: there continues to be steady demand from an occupier perspective and new supply remains broadly constrained, owing to a scarcity of modern good quality space, persistently high construction costs and capacity constraints in the construction sector. This will create opportunities for our strategy to actively reposition assets and drive higher rental growth.” In the six months to 30 September the company achieved a total investment return of 3.5% with net asset value rising 0.5% to £302.9m, or 61.9p per share, and dividends up 5% to £8.8m, or 1.79pps, 96% covered by EPRA earnings with full cover expected for the full financial year. LondonMetric has recently built an 11% stake in the shares which, at 54.6p stand on a 12% discount.
Real Estate Credit Investments (RECI) generated a 5.9% investment return in the six months to 30 September with the net asset value of its portfolio of 23 property loans and bonds rising to £314m with NAV per share of £1.42. At 122p, the shares stand on a 14% discount and yield 9.6%.
Sirius Real Estate (SRE), the owner of business and industrial parks in the UK and Germany, has bought its fifth asset in Hamburg, acquiring a multi-tenant business park in the Rothenburgsort area close to the city’s port for €31.9m and on a 6.1% net initial yield.
