Rostelecom teams with VEB Ventures to acquire Atlas stake
Rostelecom has announced that it, along with VEB Ventures will acquire a stake in Atlas to develop a new generation backbone fibre-optic communication line through Europe and Asia.
The project is titled TEA NEXT and will see a new line connecting Russian western and eastern borders with the largest cities and link to Russian borders with Mongolia and China.
The network will also be extended from the country borders with Europe to the main European traffic exchange centres in Frankfurt and Stockholm. It will also link Vladivostok to Busan, Tokyo and Hong Kong via underwater communications channels.
The construction phase of the project is expected to begin in 2022 and will see Rostelecom and VEB Ventures each invest around RUB 6 billion ($81.4 million) in Atlas at the initial stage.
Mikhail Oseevskiy, President of Rostelecom, commented: “TEA NEXT will be instrumental in delivering our ambition to become the leader across all segments of the telecom ecosystem.
“With its technically advanced new generation features, the project will provide the critical foundation for the national backbone fibre optic infrastructure in the next thirty years.
“Atlas, in turn, is set to become the leader in fibre optic services for national companies, as well as the largest international operators and OTT players.
“The main feature of the project is the brand-new advantageous route from West to East of Russia with stations in key cities along the way.”
TEA NEXT began in the summer of 2020 when Rostelecom founder Atlas and started construction of the first segment running from Moscow via Saint-Petersburg through to the Latvian border.
Total investment in the project is expected to reach $650 million in the next few years with a view to finance it until 2025 partially by Atlas and a syndicated loan facility from VEB.RF and other international banks.
Oleg Teplov,director general of VEB Ventures, commented: “With only the Chinese telecom export alone expected to reach US D50 billion by 2025, it is critical that we deploy the full potential of Russia’s infrastructure as the key ISP transit point, to be able to accurately forecast the demand and customise our solutions to fulfil it.
"The sustainability impact in the communities and local economies throughout the entire span of TEA NEXT cannot be underestimated.
“The project will deliver significant social and economic benefits through local job creation, local SME supplier engagement and other economic contributions – effectively from Vladivostok to Saint-Petersburg.