Telecom Corporation of New Zealand (ASX: TEL) has bought back over a million shares, at a cost of over NZ$4 million (AUD$3.5 million).
The company is also planning to buy back up to 15 million more shares at between NZ$3.92 and NZ$3.98 a share.
The share buyback is being funded by up to NZ$1.1bn accrued from the sale of the company's Yellow Pages service, which earned the company a total of over NZ$2.2bn.
The move is an attempt to return some of the money earned from the sale back to investors.
The company is expecting no earnings growth for the next four years, as much of its money is tied up with the cost of expanding into Australia, and compliance costs and increased competition within New Zealand are keeping profit margins lean.