Pipe Networks & VSNL's Guam cable looks like a goer

Stuart Corner
Tuesday, 13 February 2007 10:02

Business IT - Networking

While it has not yet committed to installing a submarine cable link between Australia and Guam, as announced in December, indications from Pipe Networks are that the project will go ahead: a subsidiary company has been formed and a desktop route survey commissioned.

On 18 December 2006, Pipe Networks signed an MoU  with VSNL International Pte Ltd, a subsidiary of India's Tata group, to build the cable network. VSNL International owns the former Tyco Global Network and its cables would carry traffic from Guam to Asia, the US and elsewhere.

Pipe Networks told the ASX on 13 February that "The project is still at a stage that incomplete and confidential negotiations are still under way, and many matters are insufficiently definite to be disclosed...However, the progress has been encouraging and sufficient for the directors of Pipe Networks to incorporate a wholly owned subsidiary company as the project vehicle."

The subsidiary, Pipe International (Australia) Pty Ltd will initially be headed by CEO Bevan Slattery who will continue to lead the development of the project and report to the Pipe Networks board. Pipe Networks has also engaged Clayton Utz lawyers as legal advisors to the project and has selected EGS (Asia) Ltd to conduct the desktop route survey for the international cable.

The company also said: "We continue to review our skills and future requirements to select highly qualified and experienced consultants to ensure the success of this project. A number of consultants have already been appointed and others will be considered as the board believes necessary.

"Indicative interest from domestic and international parties for capacity has been significant and as such the board and management are working hard to convert that interest to binding commitments. PIPE Networks will not proceed with the project unless the firm commitments ensure the financial viability of the project."