Singapore-listed textile firm Ban Joo & Company says it plans to enter the cable business by buying two units of Telemedia Pacfic Group for 376 million dollars.

It'll fund the acquisition by issuing some 3.6 billion new shares at 10 and a half cents each.

The two units will own and operate a submarine fibre cable between Hong Kong and Indonesia.

Ban Joo says the deal is conditioned upon a number of criteria being met .

These include approval from the Singapore Exchange and shareholders as well as the two companies being granted rights from the authorities to own and operate the cable.

Giving a rationale for the purchase, Ban Joo says the textile business has been extremely challenging with thin profit margins.

It was placed on the watch-list by the Singapore Exchange late last year after incurring three consecutive years of losses.

Ban Joo says this acquisition gives it an opportunity to venture into the cable business and enable it to tap the growing bandwidth demand for broadband transmission between Hong Kong and Indonesia.

It plans to sell the textile business and exit the sector within three months after the acquisition is completed.

Ban Joo has appointed DBS Bank as the financial adviser for the deal