Asia Express - East Asian ICT
Data Communications - ArianeCorp Extends Into China With BB Joint Venture
November 23, 2004
Singapore's ArianeCorp announced this week its entrance into the China market for broadband data services, as its China subsidiary joined forces with two other companies in a US$300 million deal.


In July 2004, ArianeCorp acquired GAT (Guangzhou Ariane Telecom Technology), which owns and operates a high-speed fiber optics network that connects 100 cities and towns across 13 provinces in eastern China for a total distance of 11,119km. GAT can also link up with the rest of the world through Global Crossing's trans-Pacific fiber cable.


Plans for ArianeCorp's entrance into China broadband market call for the establishment of a new joint venture company. GAT will hold 53% stake in the venture, while its partners, Mobile Pro, a Japanese telecom and IT services provider, and Bansec-Lepta, a US-based international investment firm, will hold stakes of 5% and 42% respectively. Bansec will put US$300 million onto the table in the form of an equity investment and a shareholder loan, while ArianeCorp will offer up its fiber optics network assets held by GAT. MobilePro's contribution to the venture will come in the form of its existing customer base, which includes NTT and Sharp.


By all indications, China's market for datacom services, especially broadband, is growing at a rapid pace. Figures from China's Ministry of Information Industry indicate that revenue from the country's market for broadband data services grew by 145% in 2003, with the number of broadband data subscribers increasing by 193%.


ArianeCorp was previously known as Vikay Industrial. It was renamed ArianeCorp Ltd in August 2004. ArianeCorp manufactures and sells LCD panels and electronic products under the Vikay brand to customers in Asia, Europe, and the US.