By Brett Foley, Jonathan Browning and David Fickling, Bloomberg
There’s no certainty that any transaction will take place, the Melbourne-based company said in a regulatory statement today, responding to a Bloomberg News report that the two companies are nearing an agreement. Pacnet’s owners were seeking a valuation of about $1 billion including debt, people with knowledge of the sale process said in June.
Buying Pacnet would give Melbourne-based Telstra ownership of more than 46,000 kilometers (29,000 miles) of submarine cable from Asia to the U.S. The Australian operator has sold $2.8 billion of assets in the past year, including Hong Kong wireless carrier CSL New World Mobility Ltd. and a domestic directory business, data compiled by Bloomberg show.
“Globally these sorts of infrastructure assets are highly sought after,” Ross MacMillan, an analyst at Morningstar Inc., said by phone from Sydney. “Telstra is really focused on getting infrastructure where they know they’re going to get steady, stable cash flows.”
Telstra shares rose 0.7 percent to close at A$5.76 in Sydney, the highest in a month.