FOCUS ON MÍLA - Ardian partners with Iceland’s national telecoms network

Why was Ardian’s purchase of Míla such an unusual transaction for everyone involved?

Orri Hauksson: We were planning to sell the entirety of the national incumbent’s telecommunications infrastructure – assets that are crucial for the economy and national security – to an international financial investor, so this was a transaction that was inevitably going to attract a lot of attention. There were discussions in parliament, and public opinion was a key factor. Obviously, Síminn is a commercial entity, and we wanted to secure a good price, but other factors were crucial too. We needed a trusted partner for Iceland for decades to come and someone with very deep telecommunication expertise, the ability to execute complex transactions and strong connections in the country and across the Nordic region.

Daniel von der Schulenburg: We already work closely with leading telecoms industry players and governments, but acquiring Iceland’s entire telecoms network as a foreign investor made this an unusually sensitive transaction. At the same time, separating the network from the incumbent telco as we did was also extremely complex. Our access to former top‑level industry executives as operating partners was essential in drawing up the long‑term agreements between Míla and Síminn so that this deal could happen.

Gonzague Boutry: Telecom operators usually dispose of minority or sometimes entire single passive infrastructure networks such as mobile tower assets of fiber networks. The unique feature here is that we are executing the carve‑out of all of Síminn’s infrastructure assets and requirements: including both passive and active equipment across copper, fiber and mobile connectivity. This deal positions us at the forefront of digital infrastructure and how technology and infrastructure requirements of society and national operators will evolve over the next decade.

What factors helped Ardian to emerge as the preferred owner of Iceland’s telecoms network?

OH: The Ardian Infrastructure team was very proactive, and they put a lot of effort into the process very early on. They met many people in Iceland to build trust and answer questions, and their professional approach, reputation, and connections were important. But so were other things. Iceland was the first country in the world to elect a female president, so having Dominique Senequier as Ardian’s president really mattered.

DS: Obtaining the government’s approval for the sale of critical national infrastructure and winning public support for the transaction was crucial. We met all the senior politicians, stakeholders and regulators, and we also decided to invite a group of large local pension funds to become minority investors in Míla alongside us. This helped us convince not just Síminn but also the politicians and stakeholders that we would be a good partner and steward of Míla and ultimately resulted in an exclusive transaction.

What do you see as the big opportunities in separating Míla and Síminn to create two standalone companies?

GB: We believe this is how telecom operators will be structured in future – asservice providers with an independent open, long‑term partner meeting all their infrastructure and technology needs. Now that Míla is a standalone open‑access network owned by an infrastructure specialist, its value proposition is clearer. It is better placed to attract more service providers to its network and support a 50% increase in investment over the life of our plan. This will extend mobile coverage and accelerate the roll‑out of 5G and fiber to the home in all Icelandic households. Longer‑term, we see opportunities in building datacenter capacity thanks to Iceland’s abundant geothermal energy.

OH: There are big regulatory and financial advantages for Síminn in becoming a pure services company. But this deal will also make it easier for us to work with other service providers on new 5G services. Telecoms isn’t the winner‑take‑all game it used to be. Now it is much more about experimenting and collaborating; having Míla as the owner of the 5G network is going to help that process.

For more stories like this, discover ARDIAN’S 2021 ANNUAL REPORT