ANZ Bank to advise Pipe Networks' submarine cable project

Stuart Corner
Sunday, 25 March 2007 11:02

Business IT - Networking

Pipe Networks' (ASX: PWK) plan to build a submarine cable between Sydney and Guam has come a step closer with the company naming ANZ Investment Bank (ANZIB) as financial adviser to the project.

The bank will also provide assistance in identifying and implementing the debt and equity structure for the system, known as 'Project Runway'.

According to Pipe Networks' CEO, Bevan Slattery, "ANZIB has committed considerable resources towards Project Runway, and has significant interest and experience in submarine and other cable systems...ANZIB has a strong portfolio of specialist businesses providing services across the strategic advisory, debt – equity spectrum, including advice on debt, hybrid and equity capital raisings.

He said the decision to go with ANZIB had been made "after reviewing several highly competitive submissions....ANZIB's demonstrated experience in cable systems, global advisory team, competitive rates and commitment to build a strong relationship with Pipe Networks made them the stand out organisation."

The company has not yet made a firm commitment the project, but Slattery said: "This is a further key step in moving project Runway forward to deliver new competition to Australia's international communications transmission capacity."

Pipe Networks announced in December 2006  that it had signed a MoU with Indian international carrier and global network operator, VSNL International, to build a new submarine cable linking Australia to Guam, in a bid to break the near monopoly for direct links to the US held by Southern Cross. Slattery said at the time: "our customers are expressing frustration that despite the boom in broadband and corresponding increase in demand for international internet capacity, there has been little movement in terms of the unit cost. The result is that a number of our major customers have approached us with indicative capacity requirements should we be able to provide an alternative."