Could Telstra buy Telecom NZ?



in brief Speculation has started floating around Australia’s blogosphere from senior sources that the nation’s number one telco could find it opportunistic to be positioning itself for a buyout of New Zealand’s incumbent telco Telecom New Zealand. Some of the thinking behind such a move is expanded on in this post (we recommend you click here for the full article) by David Havyatt, a former special advisor to Communications Minister Stephen Conroy, a current advisor to Shadow Communications Minister Jason Clare, and also a former senior AAPT executive. Havyatt writes:

“Telstra has repeatedly indicated it is seeking opportunities to expand. It, like most incumbent telcos, has struggled with how to be a successful entrant when its core skill has been managing networks … The reality is that the most important market to secure first is New Zealand, because most corporations now run their A/NZ operations together. The second is that no matter the current financial state of Telecom, the synergies between the two businesses are immense. The ability to operate the New Zealand mobile business as a component of the Australian one is alone worth a lot.”

Telstra has not publicly signalled any interest in buying Telecom New Zealand. However, the telco has recently been strongly building its war chest, having sold its Hong Kong mobile business CSL for $2.42 billion in December and yesterday announcing that it would sell most of its Sensis division for $454 million. Telstra also has the potential to sell its Chinese car sales site Autohome, which recently listed on the New York Stock Exchange. Telstra’s stake is worth around $2 billion.

Telstra has previously exited its interests in the New Zealand market courtesy of selling its TelstraClear mobiles business to Vodafone in 2012. And Telecom NZ has recently exited the Australian market, selling its AAPT subsidiary to TPG in December for $450 million.

Image credit: Telstra


      • It’s all Vodafone as a company, but I believe TelstraClear still exists as a brand for internet services. “TelstraClear” is still mentioned on the front page of the Vodafone NZ website.

        Of course, that may just be for existing customers. Still, funny. :)

        • Sorry dude, they did a brand merge about 6 months ago. TelstraClear is no longer a thing.

  1. No wonder we never see any improvements in Telstra’s network, the CEO’s are always too busy playing Bondy, Ziggy was a “Bondy” specialist punting shareholder funds on worthless stock market pump and dumps.
    Telstra If you have money to spend lets see you invest it into the infrastructure that earns your income, get planning on fibre to the home.

  2. I was living in AU, Telstra is the most incompetent and horrible provider on the market, I am a customer of Telecom now in NZ and when Telstra gets their hands on this telco then I quit to Vodafone… They cannot progress – of course because they provide bad service and people quit their networks. God prevent this fusion.

  3. I’ve worked for both companies (Telstra AU and Telecom NZ), and from what I’ve seen niether can survive against international Vodafone without merging,
    Also if Telecom is bought by Telstra it will enable a lot more competition in the market as Telecom simply does not have the capital alone to put real pressure on Vodafone..

  4. Renai: Telecom NZ isn’t the incumbent provider. Chorus is, and they are wholesale only. Telecom is the defacto majority due to being the historical incumbent (Chorus was founded as the result of a structural separation).

  5. For Sale: TEL on the NZX – $3.60 o.n.o.
    (I reckon that’s a fair price which should still return a dividend yield better than a term deposit.)

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