Telstra has sold its New Zealand subsidiary TelstraClear to Vodafone New Zealand for $660 million.
The deal, which had been rumoured since early June, includes TelstraClear's voice and data-based services, as well as network infrastructure in the country and the entire New Zealand customer base.
The deal includes conditions ensuring service continuity for trans-Tasman customers.
“The deal is a natural one, bringing together TelstraClear’s fixed telecommunications and data products and corporate client base with Vodafone New Zealand’s mobile offering and retail customer-base,” Telstra chief executive David Thoday said in a statement to the Australian and New Zealand stock exchanges.
Vodafone NZ chief executive Russell Stanners said the acquisition would boost the telco's product portfolio, with a focus on Christchurch, one area where TelstraClear has significant fixed line assets.
"If approved, it will create a new force in the New Zealand market in readiness for the ultra-fast broadband roll out, providing customers with a full suite of fixed and mobile telecommunications products," he said in a statement.
The deal is expected to be completed by the end of the year but remains subject to scrutiny from New Zealand regulators, including the Commerce Commission, Overseas Investment Office and Ministry of Business, Innovation and Employment.
Telecommunications Association of New Zealand CEO Paul Brislen cautiously welcomed the deal.
"This deal has the potential to really stir up the NZ market, hopefully for the better," he said.
Brislen said a combined asset base of mobile network capability, fibre backhaul and the agreement with Telstra to continue servicing trans-Tasman clients would place Vodafone in the driving seat in the New Zealand market, challenging incumbent Telecom NZ for dominance.
He warned, however, that the deal could produce a "cosy duopoly" between Telecom NZ and Vodafone, and said the Commerce Commission will need to take that into consideration when reviewing the deal.
More to come...