Vocus Communications has announced plans to acquire Nextgen Networks in a deal worth about $500 million. Nextgen had built a 17,000km fiber backbone across Australia with fiber into 1,100 buildings including 70 datacenter.
Part of Nextgen Group, Nextgen Networks, will be acquired for $700 million. The network provider’s national fibre backhaul covers nearly 17,000 km across Australia. However, Metrocode, which is the data centre business of Nextgen Group is not part of the transaction.
Vocus will also pay $134 million for the North West Cable System, a 2,000km submarine cable connecting Darwin and Port Hedland to service offshore oil and gas platforms.
The Australian Singapore Cable, a 4,600 km submarine cable connecting Australia to Singapore with 100GB/s internet, will be acquired for $27 million. There is also a deferred consideration of up to $54 million. The acquisitions are expected to be completed in three months.
Vocus is seeking to raise $652 million to fund the acquisition by issuing new shares, while the remainder will be paid off through syndicated debt facilities. The transaction is still subject to approval by corporate watchdog the Australian Competition and Consumer Commission.
The deal, which follows their recent purchase of M2, will see Vocus add substantial infrastructure muscle in an effort to better compete with Telstra, Optus, and TPG.
Vocus already has some 700km of fiber hooking up 1,300 buildings in Australia, as well as a more extensive 4,200km of fiber over in New Zealand.