By Stuart Condie

SYDNEY--Telstra Corporation Ltd. is considering buying the South Pacific operations of telecommunications company Digicel Group Ltd., with majority financial support from the Australian government.

The ASX-listed firm on Monday said it had held talks over a potential acquisition of the 15-year-old Digicel Pacific, which operates in Papua New Guinea, Fiji, Nauru, Samoa, Tonga and Vanuatu. It generated earnings before interest, tax, depreciation and amortization of US$235 million in the 2020 calendar year with a strong margin, Telstra said.

Telstra said it was initially approached by the Australian government for technical advice in relation to the commercially attractive and region-critical asset.

Telstra's equity investment would be the minor portion of the overall transaction, it said. There is no guarantee of a transaction, it added.

Write to Stuart Condie at stuart.condie@wsj.com

(END) Dow Jones Newswires

July 18, 2021 18:42 ET (22:42 GMT)

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