ASG minority share in ASH-Cable should not be affected by Bluesky assets buyout
American Samoa Government’s minority share in the undersea fiber optical cable that was officially launched in the summer of 2009 would not be affected with the acquisition of Bluesky assets in American Samoa by a Fiji based company, according to documents filed with the US Federal Communication Commission (FCC).
Amalgamated Telecom Holdings Limited (ATH) has filed a handful of applications for FCC approval in the acquisition of AST Telecom LLC — dba Bluesky assets.
As of yesterday morning there were no public comments — in support or opposition — to the applications regarding the AST Telecom deal, according to FCC online public docket records. And it also remains unclear as to when the FCC will issue a decision.
FCC spokesman Neil Derek Grace declined to comment on Samoa News’ specific questions.
However, for background purposes, he said the applications remain pending. Also as background information, he said federal Executive Branch agencies for national security and law enforcement have filed a request that the FCC defer action pending completion of the agencies' national security and law enforcement review.
(Samoa News reported last week that the federal departments of Justice and Homeland Security had requested FCC to “defer” a decision on this matter until their review is completed. See Samoa News edition Mar. 21 for details.)
For the timing on when a decision would be made, the FCC regularly grants such applications shortly after staff receives an Executive Branch recommendation. Furthermore, often such grants are conditioned on compliance with the terms of any national security agreement the agencies enter into with the applicant, according to FCC.
The acquisition of AST Telecom assets, which includes the American Samoa Hawai’i Cable LLC (or ASH-Cable), has raised concerns from the Lolo Administration as well as many in the community as to what will happen to ASG’s 33.33% control of the fiber optic cable.
Among the applications filed with the FCC is the joint one between Spain-based Amper S.A. and ATH for transfer of control of “cable landing licensees” — which are AST Telecom, ASH-Cable and Samoa American Samoa Cable (SASC), LLC — from Amper to ATH.
According to the application, Amper acquired the Bluesky Licensees and their affiliates in 2011 as part of a larger acquisition of Florida-based eLandia Technologies. Amper controls 91.8% interest in eLandia — a holding company for the Bluesky Communications Group’s investment in the ASH Cable. Additionally, eLandia owns about 66.67% equity and voting interest in ASH Cable — which owns 100% voting and equity interest in SASC.
Under the proposed transaction, ATH, Amper, eLandia, and AST executed a Purchase Agreement, pursuant to which ownership of the Bluesky Licensees and ultimate control of their FCC licenses and authorizations will be transferred from Amper to ATH.
Under the Purchase Agreement, eLandia will sell to a yet-to-be formed U.S.-incorporated holding company (or “U.S. Holdco”) that will be a wholly-owned direct subsidiary of ATH, all of the issued and outstanding member interests in AST, and eLandia will sell to ATH all of the issued and outstanding shares of eLandia.
Thus, post-closing, AST will become an indirect wholly-owned subsidiary of ATH, while ASHC and SASC will become indirect majority-owned subsidiaries of ATH, the joint application states.
ATH’s acquisition of the Bluesky Licensees is part of the larger Proposed Transaction, in which ATH will acquire Amper’s interests in the Bluesky Communications Group’s operations in the Cook Islands, Samoa, and New Zealand, it says.
“The parties seek to consummate the Proposed Transaction no later than December 2017,” according to FCC filings, adding that upon completion of the Proposed Transaction, AST will become an indirect, wholly-owned subsidiary of ATH, which will control an approximate 66.67% interest in ASHC, with ASG controlling the remaining approximate 33.33% interest in ASHC. SASC will remain a direct wholly-owned subsidiary of ASHC.
ASG’s interest in ASH-Cable “will not be affected by the proposed transaction,” the applicants say.
Last September, Attorney General Talauega Eleasalo Ale told Samoa News that ASG has notified “Amper that it is in violation of the ASH Cable Limited Liability Agreement by failing to notify ASG and failing to honor ASG's right of first refusal before accepting ATH's offer to buy the shares of ASH Cable owned by Amper's subsidiary eLandia.”