Digicel Pacific is a “very attractive” asset, according to Telstra boss
Telstra chief executive Andy Penn described Digicel Pacific as an attractive asset and said discussions about the potential acquisition of the telecommunications company owned by Denis O’Brien were continuing, according to media reports. Australian.
“Digicel is a very attractive and successful company in the Pacific region and we are having these discussions with the government right now,” the Australian Financial Review told ABC Radio. “We would only do this if we believed it was in the best interests of our shareholders.”
Telstra’s A $ 2 billion offer for Digicel Pacific would be backed by a loan from the Australian government.
Digicel hired Citigroup at the end of last year to advise it on a possible sale of its Pacific operations, spanning Papua New Guinea to Fiji, Samoa, Vanuatu Tonga and Nauru, after receiving a number of ‘unsolicited approaches for unity.
Chinese-owned telecommunications operators, including China Mobile and ZTE, are also reportedly interested in buying Digicel Pacific, which has 3G and 4G mobile phone networks and access to submarine cables.
Australian media have previously reported that senior Australian government officials are concerned about China’s interest in communications infrastructure in the region.
Mr Penn said the government had its “own interests” in Digicel.
Telstra informed the stock market last month that it was in talks to buy Digicel Pacific in partnership with the federal government.
“Telstra was initially approached by the Australian government to provide technical advice regarding Digicel Pacific, which is a commercially attractive and essential telecommunications asset in the region,” Telstra said in the statement.
“If Telstra were to proceed with a transaction, it would be with government support in financial and strategic risk management. In addition to significant government funding and a support program, any investment would also have to meet certain financial parameters, with Telstra’s equity investment representing the minor part of the overall transaction.
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