Over the last ten years Wireless Infrastructure Group has strived to maintain excellent service to its customers whilst expanding its range of infrastructure solutions. With a leading position now established in the UK indoor neutral host sector and a growing portfolio of fibre-connected small cells under its belt, WIG now turns its attention to opportunities for both organic and inorganic growth in 2019. TowerXchange spoke with CEO Scott Coates to find out more about what the company has planned.
TowerXchange: Can you update us on where Wireless Infrastructure Group is right now?
Scott Coates, CEO, Wireless Infrastructure Group:
We are now organised clearly into three distinct units: Towers, Indoor Networks (which incorporates our established DAS business but operates with a far broader scope) and Strategic Projects, which includes longer range opportunities such as fibre, smart cities and transport-based developments such as the Transport for London (TfL) project.
Through these business units, our core strategy remains the same as it has been for many years - to keep improving the quality of service for our customers and to add to our base of high-quality infrastructure through new construction and selective M&A.
Our business operations platform is very well established with many of our team having been together for a decade or more running independent wireless infrastructure in the UK. This is a key asset for our business, and we continue to develop it alongside our processes to lead the sector on infrastructure and service quality. A good example of this is the early investment we made in implementing Siterra in our back office to become the first European towerco with this capability.
WIG is primed and more capable than ever to manage a significant step up in tower ownership and operation.
TowerXchange: Tell us about your expansion plans for 2019.
Scott Coates, CEO, Wireless Infrastructure Group:
We are looking to grow through new infrastructure construction and through M&A.
We secured significant new long-term debt facilities in the second half of 2018 which gives us plenty of firepower for the right M&A targets and our organic growth plans.
We have a very full pipeline of Indoor Networks projects. We now work with 20 of the UK’s largest 30 shopping centres, a growing number of iconic stadium venues such as Anfield, Lord’s and BT Murrayfield, and large campuses such as King’s Cross, MediaCityUK and Canary Wharf. Across our Tower portfolio, we’ve recently completed a build-to-suit (BTS) programme which is a relatively new model in the UK – we have the capacity and desire to do more of these kinds of programme.
Across our Tower portfolio, we’ve recently completed a build-to-suit (BTS) programme which is a relatively new model in the UK – we have the capacity and desire to do more of these kinds of programme
On the M&A front we have maintained our disciplined approach to transactions and during 2018 we completed a number of transactions including the acquisition of a new tower portfolio in Ireland and a portfolio of DAS assets from Arqiva. We will continue to look at most deals in the market but believe there is a creeping tendency for over-heating in some assets that may not be strategic enough to merit it.
Our key priority on M&A is to position ourselves for any opportunities from a major divestment of tower assets by UK MNOs. The UK needs a proper scale rival to Arqiva in the independent infrastructure space and with over 10 years’ experience in the UK market and a well-invested platform we know WIG would be a great partner for a strategic deal that could be transformative in the UK market.
TowerXchange: What about your indoor connectivity business? Tell us about your recent acquisition from Arqiva.
Scott Coates, CEO, Wireless Infrastructure Group:
Our Indoor Networks business is mainly an organic story but the Arqiva acquisition represented a strategic opportunity for our growth ambitions in this space.
One thing we find with Indoor Networks is that they often demand a bespoke solution with a hands-on approach to getting deployment delivered. For bigger wireless infracos, even a large stadium network doesn’t shift the needle enough to really command the attention required to make the project work well. WIG has around £500mn of wireless infrastructure assets and we can still get excited about the intricacies of indoor projects and the entrepreneurial approach required to make them succeed. The deal with Arqiva involved 42 systems and the attraction for us was more around the opportunity to really invest behind the portfolio to upgrade and extend these systems. We were also pleased to secure the transaction in an off-market process that benefitted both sides.
We have been developing Indoor Networks for nearly seven years now and have made some real changes to the way the market works here in the UK. The old model involved real estate owners demanding significant payments to allow infrastructure to be deployed in their venues. A lot of our up-front work with venue partners is to illustrate the benefits of great connectivity in terms of customer experience and engagement.
Today the model in the UK has completely shifted and we see more of our venue partners actively participating in infrastructure costs to secure the best possible network. We are pleased to have played a leading part in that. Moving forward the opportunity is to deploy high quality 4G infrastructure into medium sized buildings like offices and hotels under a model that sees the venues and real estate owners pay for the infrastructure as a service rather than the MNOs.
TowerXchange: What’s happening with your developmental projects?
Scott Coates, CEO, Wireless Infrastructure Group:
On the back of our first fibre and CRAN deployment last year, our next project of scale is in Birmingham and Coventry, where we are the wireless infrastructure partner to a programme testing connected and autonomous vehicles. We are planning a major investment into fibre deployment to support small cells on lampposts and to create a backbone infrastructure for future expansion. We still view fibre as exploratory – the volumes for small cell rollout in the UK are still thin, with only a handful of trials and a few pockets of deployment. We are a long way from the US market take up of small cells.
We have a handful of other strategic projects in the transport sector, and are also a shortlisted bidder (the only British provider, in fact) for the TfL project to deploy DAS on the London Underground and deploy fibre across TfL’s London asset base. Whilst this is an important opportunity to extend our DAS activities it will only work, in our view, if TfL follows the approach taken elsewhere in the market to help manage the affordability of the infrastructure to the MNOs. If the commercial model is wrong then we risk a similar outcome to the Toronto metro which has suffered from minimal MNO take up and sub-optimal wireless experience for end users. Great connectivity on the Underground can help stem a decline in passenger numbers and improve productivity and so there is a lot at stake.
