Seaborn Networks and global private markets investment management firm Partners Group (SIX: PGHN) have completed a US$500 million project funding for Seabras-1, a new transoceanic subsea fiber optic cable system directly connecting points of presence (POPs) in New York City (US) and São Paulo (Brazil), jointly owned by the two companies.
Partners Group provided the equity financing, and development capital was provided by Seaborn. Debt financing of up to US$267 million backed by COFACE, the French Export Credit Agency, was provided by Natixis, Banco Santander, Commerzbank and Intesa Sanpaolo. Natixis acted as sole Structuring Bank, Underwriter, and Mandated Lead Arranger for the senior debt facilities, and as COFACE Agent for the transaction. All conditions to the Seabras-1 project financing have been fully satisfied; debt and equity funds have been drawn.
Seabras-1 uses next-generation coherent technology to deliver high-capacity and low latency telecommunications for one of the fastest-growing transoceanic routes in the world. This six-fiber pair system with initial maximum design capacity of 72Tbps is the first system to provide a direct point-to-point route between the commercial and financial centers of the United States and Brazil. Seabras-1 also includes branching units installed on certain of its fiber pairs that point towards Halifax (Canada), Ashburn (US), Miami (US), St. Croix (US), Fortaleza (Brazil), Rio de Janeiro (Brazil), and Las Toninas (Argentina).
Seaborn-managed Seabras-1 offers a wide range of capacity options (including lit, spectrum, and portions of fiber pairs) for POP-to-POP service on the New York to São Paulo route.
“We are extremely pleased to announce that Seabras-1 is fully funded and that manufacturing of this system is ongoing,” said Larry Schwartz, Chairman & CEO of Seaborn Networks. “As global telecommunications demands continue to grow, we are determined to offer the most compelling range of alternatives for purchasers of international broadband capacity.”
“Seabras-1 is a key telecommunications infrastructure project for the Americas and will bring tangible benefits to businesses and individuals in Brazil and neighboring countries,” stated Todd Bright, Managing Director and Head of Americas Private Infrastructure at Partners Group.
Alcatel-Lucent Submarine Networks, now part of Nokia, is currently constructing Seabras-1 for Seaborn under a contract in force. Diverse, dark fiber backhaul and metro routes at each end of the system have been fully secured. Manufacturing of the Seabras-1 system is in progress, and the committed ready-for-service date is in the second quarter of 2017.
In the 165-year history of the subsea communications cable industry, Seabras-1 represents the first export credit agency-backed project financing of a subsea cable system.
Seaborn Networks is a developer and operator of submarine fiber optic cable systems with an independent cable operator model, including Seabras-1 which is the first direct point-to-point submarine cable system between the financial centers of the US and Brazil. Seabras-1 is a 72Tbps system that will connect New York and São Paulo. Seaborn was founded by successful submarine cable and wholesale carrier executives with experience in designing, building and operating many of the world’s largest submarine and terrestrial networks. Seaborn is based in Beverly, Massachusetts.
Seaborn’s CEO Larry Schwartz, previously served as CEO, board member and one of the owners of the parent company of Global Marine Systems, which operates one of the world’s largest fleets of cable ships and is a leading installer of submarine fiber optic cable systems for the telecommunications industry. He led the acquisition of Global Marine from Global Crossing in 2004 as well as the asset acquisition of Red Sky Systems, a developer of subsea network technology. He also previously served as a board member of International Cableship Pte Ltd, a JV with Singapore Telecom that provides subsea cable maintenance in South East Asia. He previously served as a senior executive at Genuity, he was a partner at law firm Choate Hall & Stewart, and began his career at White & Case, focusing on international project finance transactions, large-scale privatizations and M&A.
Partners Group is a global private markets investment management firm with over EUR 42 billion (USD 47 billion) in investment programs under management in private equity, private real estate, private infrastructure and private debt. The firm manages a broad range of customized portfolios for an international clientele of institutional investors. Partners Group is headquartered in Zug, Switzerland, and has offices in San Francisco, Houston, New York, São Paulo, London, Guernsey, Paris, Luxembourg, Milan, Munich, Dubai, Mumbai, Singapore, Shanghai, Seoul, Tokyo and Sydney. Founded in 1996, the firm employs over 800 people and is listed on the SIX Swiss Exchange (symbol: PGHN) with a major ownership by its partners and employees. Founding partners are Alfred Gantner, Marcel Erni and Urs Wietlisbach.
Natixis is the corporate, investment, insurance and financial services arm of Groupe BPCE, the 2nd-largest banking group in France with 36 million clients spread over two retail banking networks, Banque Populaire and Caisse d’Epargne. With more than 16,000 employees, Natixis has a number of areas of expertise that are organized into three main business lines: Wholesale Banking, Investment Solutions & Insurance, and Specialized Financial Services. A global player, Natixis has its own client base of companies, financial institutions and institutional investors as well as the client base of individuals, professionals and small and medium-size businesses of Groupe BPCE’s banking networks. Listed on the Paris stock exchange, it has a solid financial base with a CET1 capital under Basel 3 of €13.3 billion, a Basel 3 CET1 Ratio(1) of 11.5% and quality long-term ratings (Standard & Poor’s: A / Moody’s: A2 / Fitch Ratings: A).