Approval sought for sale of underwater fibre-optic units
Regulatory approval is being sought from Bermuda for the sale of two underwater fibre-optic units, including GlobeNet the largest subsea cable provider to the Island.
Grupo Oi SA, the owner of Brazil's fourth-largest wireless carrier, has agreed to sell its underwater fibre optic cable units to a fund led by investment banking firm Grupo BTG Pactual SA for some $772 million.
Rio de Janeiro-based Oi said the transaction is subject to regulatory approval in Brazil as well as Venezuela, Colombia, Bermuda and the United States, where the units, known as Brasil Telecom Cabos Submarinos Ltd and GlobeNet, operate, according to a securities filing.
The buyer of both units is BTG Pactual Infraestrutura II Fundo de Investimento em Participa EcIoes, a private-equity fund controlled by the Sao Paulo-based investment bank, the filing added.
With its Cable Landing Station in St David’s, GlobeNet carries most of the Island’s overseas telephone calls and internet traffic.
GlobeNet provides International capacity between North and South America over a dual ring-protected submarine cable system serving Brazil, Bermuda, Colombia, the US, and Venezuela.
Covering a distance of more than 22,500 kilometres, this sophisticated submarine cable network system is fully redundant.
The network links cable landing stations in Tuckerton, New Jersey and Boca Raton, Florida, with cable landing stations in Fortaleza (CE) and Rio de Janeiro (RJ), Brazil, St David’s, Bermuda as well as Maiquetía (Caracas) Venezuela. GlobeNet is a wholly owned subsidiary of Brazilian full-service telecommunications provider Oi.
In 2008, KeyTech Limited invested $27 million and built a submarine high-capacity cable system linking the US and Bermuda, which enabled Bermuda to diversify its previous reliance on Cable & Wireless and GlobeNet/Brasil Telecom.
In 2012, GlobeNet announced a replacement of part of its fibre-optic subsea cable to provide more than 30 times the current capacity between Bermuda and the US, completed this year.
GlobeNet and specifically Bermuda’s submarine fibre-optic link to New Jersey is one of hundreds of international assets the US considers critical to national security.
The whistle-blowing website WikiLeaks released a classified internal US State Department cable outlining assets around the world it considers “critical infrastructure”.
And Bermuda’s GlobeNet cable, owned by Brasil Telecom, was listed as a critical asset for the US as part of a huge submarine cable ring linking Bermuda, New Jersey, Brazil and Venezuela.