Bank buys slice of Telecom offshoot

By RICHARD BRADDELL

Telecom's $A500 million ($638 million) Australian customer Commonwealth Bank of Australia is to take a 5 per cent stake in subsidiary TCNZ Australia, with rights to go to 35 per cent over five years.

Financial details have not been disclosed, but Telecom spokesman Martin Freeth said that while TCNZ Australia's assets were not substantial, they anticipated growth over the next year, mainly in customer premises equipment.

Commonwealth Bank is TCNZ Australia's sole customer after yesterday's signing of the $A500 million contract with Telecom to supply telecommunications services over the next five years.

Mr Freeth said TCNZ Australia existed to service the Australian corporate market and would seek other customers who it would also service in conjunction with AAPT and ComTech and EDS.

AAPT is at present the subject of a $A444 million takeover bid from Telecom which would take its 80 per cent shareholding to 100 per cent.

Mr Freeth would not comment on a report that discussions may have taken place last Friday between Telecom's chief executive, Theresa Gattung, and Singapore Telecom on the latter taking a strategic stake in Telecom. Previous speculation has centred on Japan's NTT Docomo as being a potential partner in a regional alliance involving Telecom.