Telstra confirms 'incomplete' talks to buy Digicel Pacific

Telstra said it has held “incomplete” talks to potentially buy South Pacific telco Digicel Pacific.

The potential acquisition was reported by the Sydney Morning Herald over the weekend, with the government reportedly stumping up most of the price.

The buyout offer has regional security overtones, with the federal government reportedly concerned that the asset could be bought by Chinese interests if an Australian offer is not forthcoming.

A similar situation arose in 2018 when Australia offered to fund subsea internet cables in the region, again to stop Chinese companies from funding the projects.

Telstra said in a market filing on Monday that it is in “discussions regarding a potential transaction to acquire telecommunications company Digicel Pacific in the South Pacific region in partnership with the Australian Government.”

“The discussions are incomplete and there is no certainty that a transaction will proceed,” it said.

Telstra confirmed that any equity investment it made would be a “minor portion of the overall transaction”, which confirms the government will foot most of the bill.