Digital 9 Infrastructure PLC (LSE:DGI9) shares surged over 6% on Tuesday on news it would exit an investment in the EMIC-1 subsea cable project.
“The project continues to be impacted by ongoing conflicts in the Red Sea area, which have led to an indefinite delay,” Digital 9 said on Tuesday.
Some $42 million (£33.5 million) would be raised through the sale of its stake in the project, which was due for completion in March 2025.
This marked a 15% discount to the project’s latest US$49.6 million valuation, but would release Digital 9 from US$10 million of additional construction commitments, it added.
Proceeds would be used to reduce Digital 9’s revolving credit facility balance of £53 million, as talks also took place over further sales to cut debt and extend the facility’s deadline beyond March.
"The sale of EMIC-1 represents a key milestone for progressing the wind-down of the company and deleveraging the balance sheet [...] achieving what the board believes is an acceptable value outcome in a challenging environment,” chairman Eric Sanderson said.
Shares climbed 9.1% to 19.20p.