Megaport sells east coast fibre network for $15m

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Megaport sells east coast fibre network for $15m

Enters 15yr lease-back deal with new owner Amcom.

Megaport has sold 180km of its fibre network covering Melbourne, Sydney and Brisbane to Amcom for $15 million, and will lease back the assets under a 15-year arrangement.

Amcom's purchase will give it access to 17,000 buildings, 30 data centres (plus a further 18 on the way), and around 30 NBN points of interconnect across the three cities.

The company estimates that it will be able to service an extra 5000 customers through its new data centre assets.

Amcom will install infrastructure in 30 exchanges as part of its expansion, to enable Ethernet in the First Mile (EFM). Customers will start being connected early next year.

“We have successfully deployed EFM in Perth and it has provided us with speed to market ahead of the fibre rollout, as well as a cost effective platform to win new business customers,” Amcom CEO Clive Stein said in a statement.

Megaport founder Bevan Slattery revealed his company's new fibre spin-off, Superloop, would lease back the fibre assets following the handover.

He said Megaport and Superloop would both retain "long-term access" - specifically 15 years - to the fibre network

"We have been working cooperatively for some time with Amcom towards a transaction that accelerates Amcom's east coast expansion strategy, but also provides Megaport and Superloop with long-term access to fibre infrastructure necessary for each company's development," he said in a statement.

Megaport's Superloop will offer customers a dark fibre connection to a number of data centres - Global Switch and Equinix facilities in Sydney and Melbourne, and the national network of NextDC data centres - across the country by January 2015.

Amcom has also signed a 15-year access agreement with network operator FirstPath.

Amcom remains in discussions with data centre and communications provider Vocus over a proposal to combine the two businesses.

Vocus took a 10 percent stake in Amcom last month as it gauged Amcom's interest in merging the two companies.

Stein today said there was no certainty as to whether the discussions would result in a transaction.

"Amcom will continue to update its shareholders when it is in a position to do so,” he said.

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