€6.9m subsea cable deal ‘the foundation for what we want to build in Cyprus’ – BMIT CEO

BMIT Technologies has announced that it is expanding to Cyprus, launching its presence in the country by acquiring long-term capacity rights on the Arsinoe submarine internet cable system

The €6.9 million deal is “the foundation of what we want to build in Cyprus,” said BMIT CEO Christian Sammut.

“Around it we will grow our managed IT services business, the cloud, security and support work we already do in Malta, through a team in Cyprus backed by the team here.”

The acquisition adds a third asset category into BMIT's digital infrastructure pillar, alongside more than 300 passive mobile tower sites and a 49 per cent stake in Malta Properties Company plc, and follows a direction the company has communicated to shareholders over several years.

“We set out a plan to broaden what this company is built on,” said Mr Sammut. “Owning infrastructure alongside the IT services business, and growing beyond a market the size of Malta.

“The first part is well established, with the digital infrastructure pillar now a material part of what we are. This is the second part starting.”

BMIT said that, as a larger EU island economy, Cyprus presents a market of meaningful scale in which businesses operate under the same regulatory requirements around resilience and security as its customers in Malta.

The rights are being acquired from fellow GO subsidiary Cablenet Communication Systems plc and cover capacity on a system linking Egypt, Cyprus and France.

Almost half of the capacity is already contracted and generating revenue, with Cablenet continuing to use it under a long-term agreement that pays BMIT an annual service fee, adjusted for inflation and running to 2047.

The remaining capacity is available for BMIT to commercialise and sell to Cablenet and third parties. The capacity is already operational and will continue generating revenue for a further 22 years.

The company said it expects a meaningful contribution to profit from the first year of operation.

The rights cover 5 per cent of the Arsinoe system's capacity, together with capacity in service on the separate Alexandros system, and take the form of an indefeasible right of use, or IRU, which works in much the same way as a very long lease and gives BMIT the use of capacity on the cable rather than ownership of the cable itself.

The system remains owned and operated by CYTA, the state-owned telecommunications provider in Cyprus.

The Arsinoe internet cable is the name of the PEACE Cable’s branch to Cyprus. The same cable also has a branch to Malta, owned by GO.