Cinven has exited Spanish fibre network operator Ufinet Group in a two-part deal that is understood to have made the firm a €1.1bn capital gain.
Cinven’s fifth fund has sold Ufinet’s Spanish operations to Antin Infrastructure, and Ufinet’s international business to Cinven’s sixth fund.
Overall, Cinven V has made a 6x return and a 61 per cent IRR, according to a source with knowledge of the matter.
Ufinet was carved out of Spanish utilities business Gas Natural Fenosa in June 2014 in a €510m pre-empted deal. It has reported 25 per cent annualised Ebitda growth in the three years since.
Cinven pursued a buy-and-build strategy which increased Ufinet’s presence in Latin America. More than two-thirds of the company’s revenues are now generated from outside Spain, compared to less than half when Cinven acquired the business.
Cinven will now retain ownership of the international business through its sixth fund, which closed in June 2016 at €7bn. Ufinet International operates in 14 countries including Columbia, Panama and Guatemala, via a fibre network of almost 50,000 kilometres.
The international business will be headquartered in Spain and led by chief executive Iñigo García del Cerro, who held the same role at Ufinet Group throughout Cinven’s hold. It will continue to expand into new countries, including Chile, Mexico and Peru.
“Ufinet International is uniquely positioned internationally, particularly in Latin America, with a ‘first mover advantage’ in the region, and a proven platform for consolidation having completed five acquisitions in the past three years. The fibre market in this region is in its infancy, with demand for fibre continuing to grow as businesses transition to using high speed connectivity,” said David Barker, partner at Cinven.