See Enable Networks ownership review signals possible sale in the April 17 edition The Download Weekly.

Christchurch City Council’s investment arm Christchurch City Holdings Ltd is reviewing ownership of Enable Networks. While there is nothing official, the review raises the prospect of a partial or full sale of one of New Zealand’s four fibre wholesalers.

Enable owns and operates the ultra-fast broadband fibre network across Greater Christchurch and surrounding areas. It is wholly owned by the council via CCHL.

The business was established in 2007 after concerns Christchurch was falling behind on fibre rollout. Later it became a partner in the government’s Ultra-Fast Broadband (UFB) programme.

At the time there was discussion regarding a partnership or potential merger of operations between Chorus (then a division of Telecom) and Enable. This was during the early days of the UFB rollout.

In 2011, Chorus and Enable entered into a formal partnership arrangement. Industry analysts at the time speculated this could lead to closer integration of their networks or even an eventual acquisition.

Enable’s network now passes more than 220,000 properties.

What triggered the review

The current interest in a potential sale comes after an ownership review was signalled in CCHL’s 2026 interim report.

While CCHL says its role is limited to assessing options and advising councillors, the review has been widely interpreted as a precursor to a potential sale.

This is backed up by a report in The Australian newspaper that says Macquarie Capital has been engaged to explore options for a transaction that could value Enable at up to $1 billion.

Neither CCHL nor the council has confirmed the bank’s role or the scope of any mandate.

How much is Enable worth?

A $1 billion valuation appears at the upper end of expectations. Enable’s most recent financials point to a lower figure. CCHL places its “investment value” at $714 million. The company reports total assets of about $892 million.

Enable generated $41.1 million in net profit last year and paid a $25 million dividend to the council. This make it a steady income-generating asset. However, it also carries roughly $294 million in debt.

A sale would require approval from elected councillors and is likely to trigger a formal public consultation process, given Enable’s status as a strategic asset under local government rules. CCHL cannot independently divest major holdings.

Council divisions

The review has exposed divisions within Christchurch’s political leadership. The arguments are familiar from earlier asset sale debates involving New Zealand local government.

Some councillors argue there is no democratic mandate to consider selling Enable and have questioned both the transparency of the process and the use of external advisers. Others say regularly testing the value and strategic fit of council-owned assets is standard governance practice. They stress that no decision has been made.

Debate also centres on what a sale would achieve. Those in favour of asset recycling argue proceeds could reduce council debt or fund new infrastructure. Critics counter that selling a profitable, future-proof utility risks sacrificing long-term income and control for short-term gains.

Comparable deals

Beyond local politics, there has been a wave of telecommunications infrastructure and related deals in New Zealand. The retail telcos have sold their mobile towers in deals that attracted strong interest from overseas pension funds. More recently Spark sold a majority stake in its data centre business.

In 2020, Ultrafast Fibre (now Tuatahi First Fibre) was sold to First State Investments, an Australian asset management company for $854 million.

Using the 2020 sale as a rough benchmark, it implied a valuation of $5,000–$5,500 per active connection. Applying a similar range to Enable’s roughly 150,000 active connections suggests a valuation in the region of $800 million.

A changed market

Market conditions have changed. In 2020 Ultrafast didn’t have to compete with 5G fixed wireless broadband or with low earth satellite alternatives. These factors may influence how a potential buyer assesses Enable’s long-term value.

Enable’s recent $41.1 million profit implies a return in the order of five percent, broadly consistent with investor expectations for regulated infrastructure assets.

Infrastructure investors often talk in terms of WACC (Weighted Average Cost of Capital). Regulators like the Commerce Commission set a target WACC to ensure companies like Enable make enough money to stay healthy and keep investing, but not so much that they are taking advantage of their monopoly.

Enable hitting that $41.1 million mark suggests they are operating right in that goldilocks zone—profitable enough to be a crown jewel for the Council, but efficient enough to keep the regulator happy.

Living with the regulator

A new Enable owner would need to operate within New Zealand’s fibre regulatory framework, including oversight by the Commerce Commission and the requirement to provide wholesale-only fibre services to retail providers. That might be a barrier to some potential buyers, but it also implies certainty and predictability.

For now, any sale process remains exploratory. The existence of a review is confirmed, but the likelihood, timing and structure of any sale remain uncertain.