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FINANCIAL AND LEGAL INFORMATION
1
Presentation and history of the Company
Sector
Country
Date
of investment
Residual cost
in €m
Fair value
in €m
% of the portfolio
at fair value
Malta
2016
33.9
33.9
3.9
www.melita.com1) Business description
Melita is the leading converged telecommunications operator in
Malta. It supplies 99%of homes inMaltawith high-speed, digital
cable access andhas 110,000unique subscribers, corresponding
to approximately 70%of Maltese households. Melita offers pay-
TV, broadband internet access, fixed andmobile telephony, and
B2B services. In addition to its leading-edge cable network, it
operates its own mobile network, a data centre built to Tier 3
specifications and a Wi-Fi hotspot network across the Maltese
islands.
2) Why did we invest?
Melita is the leading converged fixed-mobile telecoms operator,
the leader in thepay-TVandbroadbandmarkets anda challenger
in the mobile market. It has a technological advantage over
competitors, notably a faster internet speed. Melita is one of the
first convergedcableoperators inEuropeproviding fixed-mobile
services as well as triple-play (3P) and quadruple play (4P)
bundles, for which consumer demand is very high.
The Maltese market has robust fundamentals: a good macro
outlook, a growing population and a buoyant economy with
an increasing demand for B2B telecom and hosting services.
There is a clear path to revenue growth, driven by (i) competitive
Mobile/4P offers, (ii) demand for higher internet connection
speeds, and (iii) the development of B2B activities. Meanwhile,
operational efficiency improvement is expected to lead to
margin uplift.
The investment was made with a quality partner, Fortino, which
is headed by former executives of Telenet. Fortino co-invested
alongside Apax funds in Melita and in Nowo/Oni (Portugal)
and helped to bring in operating advisors to work with the
management team on various projects and capture synergies
between Melita and Nowo/Oni.
3) How do we intend to create value?
The investment thesis is to: (i) continue to invest in cable
infrastructure tomaintain the company’s broadband leadership,
by increasing the internet speeds delivered to customers, and
regain television market share by improving the content and
customer experience; (ii) develop Mobile market share through
bundling with fixed services; (iii) unlock B2B market potential;
and (iv) improve customer care and operational efficiency.
4) What has been achieved?
A new Chairman & CEO with extensive experience in
telecommunications and in the cable industry was recruited in
April 2016. Previously, he served as Board member and CEO of
BlizooMediaandBroadband (the largest operator inBulgaria), as
CEOof theGermanoperator Kabel BWand as CEOof HanseNet.
The new chief implemented several newmeasures, taking steps
in particular to improve customer care.
Additionally, the company is working to roll out new set-top
boxes andmodems andupgrade both themobile network (from
3G to 4G) and the fixed infrastructure.
5) How is it performing?
In 2016, Melita outperformed its budget slightly, delivering 8%
growth in EBITDA vs. 2015.
Its revenue rose by 5% to €64.8m, driven by broadband, B2B
and mobile growth.
As of 31 December 2016, as a company held in the portfolio for
less than one year, Melita was valued at cost.
6) How will we crystallise value?
With its subscription-based business model, strong growth,
excellent operational performance, and high cash flow
conversion, the company should be highly attractive to both
financial and trade buyers.
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REGISTRATION DOCUMENT
1
ALTAMIR 2016