Pipe Networks seeks more time for funding talks

Tasman cable contender claims progress in arranging alternative finance

Pipe Networks, Kordia's partner in a bid to build a new trans-Tasman cable, is claiming its attempts to raise finance are making progress, but has asked the Australian Securities Exchange to continue a temprorary suspension in the trading of its shares.

In a note to the ASX, the company says its attempts to raise alternative finance with suppliers and customers to complete its PPC-1 Pacific cable have made "significant progress", but are still incomplete.

Pipe now says it does not expect these talks to be finalised until late next week.

Last week Pipe entered a trading halt after its negotiations for bridging finance from ANZ and Westpac failed. It indicated that an alternative plan would be in place by last Thursday, but then filed for an extension of its trading halt until today.

"The reason for the suspension of securities relates to the ongoing negotiations which have progressed significantly, yet are still incomplete and remain confidential. The outcome of these negotiations is likely to affect the company's share price as previously identified," Pipe company secretary Malcolm Thompson said in an Australian Securities Exchange filing last Thursday.

Kordia and Pipe Networks are partners in a bid to build a trans-Tasman cable, called PPC-2, to link into PPC-1. The tender is being managed by the Research and Education Network New Zealand.

The former government put aside $15 million to support such a trans-Tasman cable build.

Last week, Kordia's CEO Geoff Hunt told Computerworld the project was commercially viable and he fully expected it to go ahead.

"We are looking with interest at what they [Pipe] have to say over the next few days," he said. "We've talked to Pipe and have no other information. We hope they'll be able to work through it. If not we will look for other partners."

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Tags KordiaNetworking & Telecomms IDPipe Networks

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