PayPal founder pumps in $5.5 mln into Pacific Fibre

PayPal founder pumps in $5.5 mln into Pacific Fibre

By Paul McBeth

Jan. 12 (BusinessDesk) – PayPal founder and Facebook board member Peter Thiel has pumped in $5.5 million into Pacific Fibre Ltd.’s bid to build a new trans-Pacific fibre optic cable.

Thiel’s latest local investment, via his Valar Ventures LP vehicle, will help Pacific Fibre tap American markets as it looks for new financing opportunities. The new investment is joined by New Zealand Trade & Enterprise stumping up as much as $250,000 in matched funding for a feasibility study to evaluate the bid’s economic benefit to New Zealand.

The Valar Ventures team’s “west coast networks and Wall Street experience will be a great help to us as we enter the major financing phase, and their commitment to helping technology companies strongly aligns with our founding purpose,” Pacific Fibre chief executive Mark Rushworth said in a statement. “We now have highly regarded investors from all three countries of operation, and we are seeing plenty more appetite from a variety of debt and equity investors for the major round.”

Thiel joins New Zealand heavyweight entrepreneurs Sam Morgan, Stephen Tindall, and Rod Drury, and comes just two months after Valar injected $4 million into Drury's accounting software company, Xero Ltd., to help that firm break into America. The market took his investment as a vote of confidence and doubled Xero's share price.

Pacific Fibre plans to build a cable between Australia, New Zealand and the U.S. in a bid to improve local broadband services, which have to go through Telecom's link to access international content, and has already secured Pacnet to partner in construction and management of the link.

Pacific Fibre's partner, Pacnet, owns Asia's biggest undersea cable, and was the biggest investor in the US$300 million Unity cable linking the US with Japan.

(BusinessDesk)

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