FLAG is a leading global data communications service provider and owner of one of the world’s largest private subsea fibre optic networks. The business provides high-bandwidth connectivity to a range of customers including over-the-top content providers, telecom carriers, new media providers and enterprises.

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Overview

FLAG’s 66,000km of cables span from North America to Asia. It is particularly strong on the Europe-Asia and Intra-Asia routes where it is well positioned to capitalise on growth opportunities and serve the exponentially growing demand for data traffic.

Why we invested

3iN was attracted to FLAG because it owns one of the most comprehensive subsea cable networks globally, serving customers in over 180+ countries. The company benefits from the rapidly expanding data market with data usage forecast to grow exponentially. It also operates in a market with high barriers to entry whilst providing an essential service. FLAG has a highly experienced management team who have a strong track record in the sector. 

Recent developments

FLAG has shown strong year-on-year growth in lease revenues and has recently signed several large bulk capacity deals on its Middle East and intra-Asia subsea routes. Financial performance was held back by a high level of cable cuts which have now been repaired. The sales pipeline is healthy and demand for subsea data capacity continues to grow, driven by increasing adoption of AI applications and substantial investments in capacity and route diversification by the hyperscalers.

Looking ahead, the company is evaluating several attractive growth opportunities, for example, acquiring new subsea capacity and developing new edge data centres near its cable landing stations that will drive additional data on its subsea network.