Telstra completes $857 million Pacnet acquisition

Telstra completes $857 million Pacnet acquisition

Purchase will double the number of Telstra’s customers in Asia

Telstra has completed its $857 million buyout of telecommunications and datacentre provider, Pacnet.

Pacnet has assets across Asia, including datacetentres, a 46,000km undersea cable network and 109 access points globally.

Telstra group executive, global enterprise and services, Brendon Riley, said Pacnet would integrated into Telstra, while the Pacnet brand would be progressively retired.

Telstra will conitnue the development of the joint venture in China. US asset will integrated when regulatory approval is obtained.

"The addition of Pacnet's staff, infrastructure, technology and expertise will position Telstra as a leading provider of services to multinational and large companies in Asia," Riley said.

"The completed acquisition will double Telstra’s customers in Asia, and greatly increase our network reach and data centre capabilities across the region.

"This includes the addition of the largest privately owned intra-Asia cable network, 29 data centres and the ability to further grow our China operations through the existing joint venture."

He said the acquisition provided the company with greater specialisation and scale, including the delivery of enhanced services, such as software-defined networking and opened up significant incremental opportunities for our business.

The acquisition, announced on December 23, 2014, was subject to a number of conditions, including the receipt of regulatory and Pacnet financier approvals.

hese have all been received with the exception of a remaining regulatory approval in the United States.

Completion of the acquisition of the US assets is expected in due course and does not impact operations or the agreed purchase price, according to a company statement.

Telstra will refinance Pacnet’s outstanding debt as soon as practicable, being repayment of Pacnet bank debt and the redemption of all of Pacnet’s existing US$350 million high yield notes.

Redemption of these notes will occur through a combination of the equity clawback mechanism under the applicable indenture with remaining outstanding notes being redeemed at the relevant premium.

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Tags TelstrapacnetBrendon Rileyglobal enterprise and servicesTelstra group executive


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