Telstra is in talks to buy the company that owns the world's largest private submarine cable network, Pacnet.
If successful, Telstra would take control of some 46,000kms of undersea cable stretching between Asia and the United States.
Telstra company secretary Damien Coleman confirmed the discussions in a statement on Wednesday, but said there is "no certainty" a transaction will take place.
The acquisition would fit with Telstra's stated plan to boost its network footprint in Asia.
Pacnet owns the world's largest private submarine cable network, the 37,000km EAC-C2C, which connects Singapore, Hong Kong, China, Taiwan, South Korea, The Philippines and Japan.
It owns a further 9,000km of cable connecting Japan to the US, delivering internet, data and voice services.
The company's owners were eyeing a valuation of about $US1 billion ($A1.08 billion) in June, Bloomberg reported.
Pacnet is headquartered in Hong Kong and Singapore, with operations in 11 countries including Australia.
Shares in Telstra rose four cents to $5.76.
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