UPDATE ON TIMELINE FOR STRUCTURAL SEPARATION
19 January 2011
Telecom has today advised that it will announce a revised timeframe for the structural separation of its business, upon entering into a contractual arrangement with Crown Fibre Holdings for the Ultra-Fast Broadband (UFB) project.
“Based on initial timeframes for the UFB project, Telecom has previously indicated that it would aim to enact structural separation by the end of June 2011,” said Paul Reynolds, Telecom CEO.
“However, that would have required Telecom to have reached a contractual arrangement with Crown Fibre Holdings last year for this timeframe to be achieved.
“In December last year, Telecom was confirmed as a negotiating partner for the UFB rollout and is now in detailed negotiations with Crown Fibre Holdings. However, the final timeframe for demerger will be determined when Telecom is able to reach an agreement.”
The company has proposed structural separation – splitting into two separate companies – as part of its proposed package for involvement in UFB that encompasses co-investment, partnership and regulatory and legislative reform.
Dr Reynolds noted that enacting structural separation is a complex and detailed undertaking, requiring far-reaching changes to Telecom’s businesses.
“There are a wide range of commercial, regulatory, legislative and disclosure considerations involved in enacting the demerger of Telecom. It will also require Telecom’s shareholders to vote in favour of the proposal.”