Australia's Telstra has confirmed it is in talks to acquire Hong Kong-based Pacnet as part of its Asia-Pacific expansion plans.
Bloombergreported on Wednesday that the negotiations are underway. Citing unnamed sources, Bloomberg said that Pacnet is seeking a valuation of around $1 billion including debt.
Telstra responded with a submission to the Australian Securities Exchange confirming that it is in discussions with Pacnet's owners, but stated there is no guarantee that a transaction will take place.
Acquiring Pacnet would give Telstra around 46,000km of subsea cable linking Asia to the US, as well as Pacnet's 19 data centers in 11 countries.
Telstra has been pursuing investments in Asian operators and infrastructure to help make up for the loss of profitability associated with the operator agreeing to transfer many parts of its Australian fixed line network to the National Broadband Network.
As well as investments, Telstra is pursuing partnerships including its deal with Telkom Indonesia to provide network applications and services to the Indonesian market.
But the company also recently sold its controlling stake in Hong Kong mobile business CSL to HKT.
A spokesperson for Pacnet declined to comment on “speculation” and stated that the company doesn't “have anything to share at this time.”