Thodey: NBN deal is key to Telstra's future

Thodey: NBN deal is key to Telstra's future

Thodey claims NBN deal is one of Telstra's top three goals and says a vote is still on track for mid-2011

David Thodey

David Thodey

Telstra CEO, David Thodey, has named concluding a deal with the NBN as one of his company’s top three goals. The comments were made during the telco’s annual general meeting in Melbourne.

According to Thodey, resolving the NBN negotiations was key to fixing Telstra’s falling share price.

He said re-establishing a relationship with the Government had been a major positive step.

"We share your disappointment with our current share price," Thodey said. "Our very clear objectives are…improve our financial results, and successfully complete the NBN negotiations and improve customer service.

"One of the very important benefits of concluding the NBN negotiations is that we will be able to operate in an environment with greater regulatory certainty. In fact this is a pre-condition of doing this transaction."

Telstra CFO, John Stanhope, acknowledged the political situation around the telecommunications act was still uncertain, but he asked shareholders to agree with the financial heads of agreement both groups had negotiated when it finally came to a vote and not push for more than the $11 billion currently agreed.

"A number of Government decisions around the Universal Service Obligation and how and where the industry will connect to NBN Co are required to provide certainty as we work towards an agreement," he said.

"We still believe we could bring this to a shareholder vote by the middle of next year."

The director also said getting approval from the Australian Competition and Consumer Commission (ACCC) was vital for providing regulatory certainty.

"Timing remains uncertain, but the first step is the continued work towards finalising the draft definitive agreements with NBN Co by Christmas," he said.

"We also need to get an independent expert to review any agreements and ensure that the value to our shareholders of this arrangement is fair value.

"Discussions on the operational aspects of the agreement are well-advanced with NBN Co so we can finalise definitive agreements."

The directors optimism around the Government's ability to pass the related Bills comes despite a day of high controversy in Parliament with the Communications Minister narrowly avoiding a gag order for refusing to release NBN Co's busness case.

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Tags Telstranbn coacccDavid Thodeytelstra ceobusiness caseJohn StanhopeTelstra CFO


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