SEACOM closes financing, starts construction

15 Nov 2007

African investors have taken a significant majority stake in SEACOM’s undersea broadband cable, joining hands with an international partner to link southern and east Africa with India and Europe. The investors have given the green light for construction of the state-of-the-art cable, committing financing for the broadband link from Mtunzini in South Africa to Mumbai in India and Marseille in France via Mozambique, Madagascar, Kenya and Tanzania. ‘This is a major milestone in the development of advanced broadband infrastructure for Africa by Africans’, said SEACOM President Brian Herlihy. ‘Ten years ago, very few believed African markets were capable of the tremendous growth experienced in the mobile industry. Today, we see the dawn of a similar revolution in the growth of data communications.’

SEACOM has already invested more than USD10 million in the marine survey and engineering of the cable. This advance work has allowed SEACOM to maintain its ready for service date of June 2009. By providing 1.28Tbps of broadband capacity, SEACOM aims to dramatically reduce prices for businesses, institutions, communities, and individuals down significantly. Providing sufficient bandwidth to accommodate high definition TV, peer-to-peer networks, IPTV, and surging internet demand, SEACOM will make a direct contribution to meeting the New Partnership for Africa’s Development’s (NEPAD’s) goals of development for Africa’s renewal and its full and beneficial integration into the global economy. SEACOM will provide the first access to true broadband connectivity for countries on Africa’s Eastern seaboard which are presently 100% reliant on expensive satellite solutions.

With more than three quarters of SEACOM’s shares owned by African investors, and agreements with service providers already in place or being finalised in most countries, the cable will provide a major boost to the continent’s international connectivity, as well as bolstering economic and social development in Africa.

The USD650 million cable covers more than 15,000km. The investors in SEACOM are Industrial Promotion Services (an arm of the Aga Khan Fund for Economic Development, 25%), Venfin (25%), Herakles Telecom (25%), Convergence Partners (12.5%) and the Shanduka Group (12.5%).