MERGERS, ACQUISITIONS AND FINANCIAL RESULTS
Financiers Give EASSy U.S.$70 Million Loan
The East African Submarine Cable System (EASSy) fibre optic cable project has received a $70 million loan from its international financiers.
The loan, announced during the West Indian Ocean Cable Company board meeting in Nairobi on November 30-December 1, was given by the International Finance Corporation, African Development Bank, KFW of Germany and AFD of France, is to be repaid over eight years.
The undersea fibre optic cable, expected to go live in June 2010, will connect 21 East, Southern, and Central African countries to Europe, America, Asia and the rest of the world as well as provide cheap Internet connectivity to most of the landlocked countries in the continent.
"We are currently expanding our shareholding structure to bring on board players and countries that were not part of the consortium initially like Seychelles and Zimbabwe," said Wood. He said there was a need for additional diverse routes to ensure redundancy and guard against downtime resulting from cable cuts.
EASSy, designed as a developmental initiative to provide cheap Internet connectivity to parts of Africa with no existing cable project, aims to deliver its services on an open access, non-discriminatory model, to ensure competition and low cost bandwidth pricing.
According to West Indian Ocean Cable Company chairman John Sirha, EASSy has led to over $4 billion of investments in the region, including Teams and Seacom, "a situation that can drive competition through multiple cables."
Sirha said the EASSy project aims to bring Internet exchanges to Africa to handle local Internet traffic instead of the current situation where the traffic is routed via Europe, the US or Asia.
The EASSY cable, according to Wood, will be the first eastern seaboard system to connect on a direct route to Europe, thereby making it the lowest latency system for traffic to key internet peering points in Europe and North America, unlike other cable systems which rely on a longer path to Europe via connections through either India or UAE.
Joseph Sloan, who represents the IFC and other international financiers on the West Indian Ocean Cable Company board, said that the $263 million project is on schedule and within the agreed budget, adding that multiple cables will lead to competition and further drive down prices of bandwidth.
The East African