(Reuters) – Macquarie-backed MEIF 6 Fibre Ltd is to buy KCOM Group Plc in a deal valuing the British telecoms company at 627 million pounds ($787.51 million), after seeing off a British pension fund in a five-day auction which ended on Friday.

Britain’s takeover regulator said last week it would auction KCOM after a unit of the Universities Superannuation Scheme Ltd. (USSL) and MEIF 6 Fibre failed to make a final offer for the company.

MEIF offered 120.3 pence per KCOM share in the auction, whereas USSL bid 113 pence, the companies said in separate statements, later confirmed by the regulator.

KCOM said it found MEIF’s offer to be fair and reasonable and recommended shareholders to vote in favor of it.

KCOM’s high price tag reflects its full-fiber network, which makes the company attractive to firms looking to build a presence in the sector without the expense of rolling-out new infrastructure.

Founded in 1899 as the telephone department at Hull Municipal Corporation in the northwest of England, KCOM now offers managed network and cloud-based services across the United Kingdom.

MEIF had intended to offer 108 pence per share for KCOM in June, 11 pence higher than the offer submitted by USSL’s Humber Bidco unit.

MEIF had initially valued the company at 563 million pounds.

Macquarie funds have been investors in critical telecom infrastructure since the early 2000s, including investments in European players Arqiva, Poland-based INEA and Denmark’s TDC.

($1 = 0.7962 pounds)

Reporting by Sangameswaran S and Tanishaa Nadkar in Bengaluru; Editing by Jan Harvey and Kirsten Donovan



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