The credit facilities, which come from a group of financial institutions including the Asian Development Bank (ADB) and GurantCo, a member of the Private Infrastructure Development Group (PIDG), comprises of an ADB loan and a parallel loan provided by the Leading Asia’s Private Infrastructure Fund (LEAP), which is administered by ADB.
LEAP is one of ADB’s co-financing vehicles dedicated to private sector infrastructure in Asia and the Pacific. GuarantCo will provide a $50 million partial credit guarantee to a private sector European institutional investor.
“The support from GuarantCo, ADB, and private investors will be pivotal in providing the long-term certainty that will allow Kacific to transition seamlessly into operational mode, following the launch of Kacific1,” said Christian Patouraux, founder and CEO of Kacific, a satellite operator providing high-speed broadband for underserved, remote and rural markets.
“Their commitment will lead to life-changing outcomes for millions living in remote communities, bringing them fast, affordable internet services that will transform education, healthcare, economic development and social inclusion.”
Taken altogether, these credit facilities secure long-term financing that enables Kacific to repay short-term facilities used to fund the construction of the Kacific1 payload and the associated infrastructure and launch costs.
Michael Barrow, director general for private sector operations at the ADB, said: “Better access to reliable, high-speed internet can help improve education services, expand access to information, attract investments, reduce rural–urban development gaps, enhance trade and connectivity, and stimulate local economies. It will also help improve communication, especially during emergencies and times of disaster when terrestrial networks might be damaged.”
The financing reflects the recognition of the impact of Kacific’s first satellite, Kacific1, will have on the development within the region and the benefits it will bring to un- and under-served communities in South East Asia and the Pacific, particularly in rural and remote areas of small island nations in the Pacific, and larger island nations like Indonesia and the Philippines.
In September, New Zealand broadband company Gravity Internet announced that it was planning to use Kacific1 to offer broadband services to rural areas of the country. Tonga Satellite, a Tongan government company, announced in April that it had signed a 15-year agreement with Kacific Broadband Satellites Group to provide high-speed broadband via satellite to the Pacific Island nation.
“We are proud to have made a contribution to the Kacific satellite launch which will provide reliable, affordable and high-speed broadband access to people living in remote areas in Asia-Pacific and encourage economic growth in some of the lowest income countries in the world,” added Lasitha Perera, CEO at GuarantCo, a Private Infrastructure Development Group (PIDG) company. “It is another example that aligns with our vision to become a centre of excellence for credit solutions for infrastructure finance in lower income countries thereby assisting with the alleviation of poverty.”
The financing is underpinned by the large number of customers, in 25 nations, who have already signed up to Kacific’s service in anticipation of the Kacific1 satellite commencing operation in early 2020.
