Alcatel to build Vocus’s $227m SE Asia cable; market unmoved
Australia’s No 4 telco Vocus Communications is looking to snare more business in South-East Asia after committing to the building of a 4600km submarine cable linking Australia to Singapore and Indonesia.
It will pay Alcatel Submarine Networks A$227 million to build the cable over 19 months. The cable had originally been planned by Nextgen, which Vocus acquired last year for $807 million.
To be known as the Australia-Singapore Cable (ASC), it is planned to link with Nextgen’s huge trans-Australian fibre network. According to Vocus CEO Geoff Horth, it will connect Australia to South-East Asia, India, and Europe at lower round-trip times, outperforming any other existing cable system.
In Australia it will terminate in Perth, but will connect to the east coast via another Vocus cable.
The ASC won’t the have market to itself. It is up against competition from several other projects to build an undersea cable, including Bevan Slattery’s SubPartners’ APX West, which is backed by Telstra and Singtel.
News of the cable deal brought just a flicker of interest from sharemarket investors. Vocus shares rose just two cents to $4.04. They are down from $9 levels in June, with their descent increasing late last month amid a boardroom bust-up that saw fonder James Spenceley depart.