Telstra tackles separation with shareholder-based submission
- 30 September, 2009 13:49
Telstra is compiling a submission for the Federal Government’s senate inquiry into the legislation-based separation of its wholesale and retail assets based on shareholder feedback.
In a letter posted to its shareholders from CEO, David Thodey, the telco giant said it was continuing its negotiations with Government but stressed its commitment to stock holders and their interests. It claimed to have received significant amounts of feedback as well as calls for updates on Telstra’s plans and strategy for the National Broadband Network (NBN).
“We are disappointed the Government has felt it necessary to introduce this legislation at a time of such fundamental change in the industry,” Telstra told shareholders. “This legislation will mean a significant change to Telstra and the industry.
“We have engaged with the Government and we have a process to work through the issues.”
Minister for Broadband, Senator Stephen Conroy, announced its intention to force a separation of Telstra’s retail and wholesale divisions as part of a massive overhaul of telecoms industry reforms in early September. The minister said it hoped separation would open up more competition across the sector.
If Telstra doesn’t comply, it will be banned from acquiring further wireless spectrum and forced to hand over its hybrid coaxial fibre (HFC) cable network and interest in digital television provider, Foxtel.
On September 17, the senate announced an inquiry into the proposed legislation. Submissions are due in on October 7.
“We are currently preparing a submission on behalf of shareholders that will focus on the areas of the legislation where we have concerns,” Telstra said in its letter. The telco’s submission will be posted on its website once completed.