Less than a week after confirming it was in talks to acquire Hong Kong-based undersea cable operator Pacnet, Australia’s Telstra has reportedly sealed the deal, agreeing to pay the former’s private equity owners USD697 million for the company. According to Reuters, with the purchase costing less than the roughly USD1 billion that analysts had expected, it will allow Telstra to boost its Asian presence dramatically, giving it instant revenues from those service carriers using Pacnet’s extensive submarine cable network, which stretches from China to the rest of Asia and across the Pacific to California. A presentation published by Telstra confirming the deal notes that the company expects the transaction to close by the end of June 2015, following which it plans to fully integrate all aspects of Pacnet ‘to capture operating and capital synergies’.
Pacnet was formed in January 2008 as a result of the merger of Asia Netcom and Pacific Internet. It owns around 46,500km of submarine cable between the US and Asia. The 9,620km EAC Pacific connects the US to Japan, and the 36,800km EAC-C2C links landing points across eight countries in Asia. Pacnet also boasts 110 points of presence globally.