Investec has announced a R2.5 billion debt package for Gauteng-based fibre infrastructure provider MetroFibre, which will see the firm expand its fibre network rollout across South Africa.
The debt package complements a recent R1.5 billion equity raise supported by new shareholder AIIM together with current MetroFibre shareholders.
The financing will primarily be used to extend fibre connectivity into underserviced homes and businesses, said Wayne Edwards, MetroFibre’s financial director.
“There’s a massive demand for fibre connectivity in many outlying regions. Filling that gap makes sense not only from a business perspective but also from a socioeconomic upliftment standpoint,” Edwards said.
“In a growing and fiercely competitive market, the timely funding arranged by Investec, together with our recent R1.5 billion equity raise, will enable us to take fibre to more individuals and more businesses, giving them the opportunity to participate in the globally connected economy.”
The funding agreement builds on an existing relationship between the two companies that dates back to 2016 when MetroFibre approached Investec for its first-ever round of debt financing.
Together with the funding from their capital raise toward the end of 2020, Edwards said MetroFibre is now well-poised for another phase of strong growth.
He said that the group plans to densify their existing networks and reach an additional 300,000 residential homes across the country over the next three years.
“We believe the fibre market has reached a tipping point. People are spending more time in their houses which has drastically increased the demand for high-bandwidth internet services, both for the purposes of working from home, education and for entertainment. Fibre is going mainstream.”