12 Oct 2023 13:38

Alfa Bank replaces Veb Ventures as Rostelecom partner on TEA Next project

MOSCOW. Oct 12 (Interfax) - Alfa Bank has partnered with Rostelecom on the project to lay the Transit Europe-Asia next generation fiber optic communication line (TEA Next).

The bank has secured the right to acquire a 49.99% stake in project operator Atlas LLC, Russia's national telecom provider reported in a press release. The financial details of the deal were not disclosed.

Rostelecom had been working on the TEA Next project with Veb Ventures, the venture capital fund of Russian state lender VEB.RF, since December 2021, but in July 2023 the fund divested its 49.99% stake in the Atlas joint venture. As a result, Rostelecom subsidiary Vestelcom consolidated 99.98% of Atlas.

The other 0.02% of Atlas is now owned by the venture's CEO Alexander Ratushny; until September it was held by Vladimir Koryagin.

Rostelecom head Mikhail Oseyevsky said in August that the company was in talks with banks on joining the TEA Next project by acquiring the stake in Atlas previously held by Veb Ventures.

Rostelecom began working on the TEA Next project in 2020, setting up the company Atlas and starting construction on the first stage of the line in 2021. Rostelecom and Veb Ventures initially equally owned the joint venture and planned to each invest 6 billion rubles in it. Overall investment in the project to 2025 was estimated at $650 million at the time.

The Russian section of TEA Next will stretch about 11,000 km, connecting the country's western and eastern borders, and largest cities, with lines running to Russia's borders with Mongolia and China, and the onshore station for underwater communication lines in Nakhodka.

In future, there are plans to extend TEA Next to the main traffic exchange hubs in Asia and Europe. Foreign partners will be able to lease fiber optic lines and place their own equipment at repeater stations along the route.

The first stage of the project, stretching about 560 km between Pskov and Tver regions, was completed at the end of 2022. There were plans to start building the Torzhok-Yekaterinburg-Mongolian border section in 2023.

About 1,400 km of the line, connecting Moscow and St. Petersburg and extending to Russia's border with Latvia, are supposed to go into operation in the first quarter of 2024. The company plans to finish the section to Mongolia and China by the end of 2025, and complete the whole terrestrial part of the project in Russia in 2026. Concurrently, it plans to build the infrastructure needed for international extensions of the line.