Australian web security company SecureNet enjoyed a positive market reaction to yesterday morning's announcement that internet giant Pacific Century CyberWorks bought a slice of the company.
In a statement issued to the Australian Stock Exchange, SecureNet announced that PCCW would acquire a 5 per cent stake in the company, valued at around $32 million, with options to increase that holding to 15 per cent.
Following the announcement, shares in SecureNet soared as high as $11.20, levelling at around $10.70, up 7 per cent, at the close of trading.
The managing director of SecureNet, Geoffrey Ross, said that the Melbourne-headquartered company would use the PCCW capital injection to develop its 12-month-old joint venture with Cable & Wireless Hong Kong Telecom.
The CWHKT SecureNet venture is centred around the sale of SecureNet smart cards and other internet security products throughout the Asia-Pacific.
CWHKT and PCCW are currently in the process of merging.
SecureNet plans to use PCCW infrastructure to broaden its distribution channels to include Japan, South Korea, Taiwan, Singapore, Malaysia and India.
The CWHKT SecureNet partnership plans to take advantage of the "intellectual property infrastructure" likely to emerge from PCCW's partnership with Telstra.
Ross would not speculate on whether PCCW's potential 15 per cent stake in SecureNet was likely to have any impact on his company's relationship with Telstra. Telstra is a SecureNet customer, as is Cable & Wireless Optus.
Ross, who is also CEO of the CWHKT SecureNet joint venture, said he planned to step down from his position with that joint venture as soon as its expanded distribution was underway, to head up another SecureNet joint venture targeting Europe. He expects the joint venture will have established internet distribution channels in more than three other Asian countries before the end of 2000.
The PCCW investment will see SecureNet joining the ranks of some 50 other internet companies that are partially owned by the Hong Kong internet giant.