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Telecom's Australian subsidiary AAPT may be up for a fight to take a blocking stake in PowerTel.
The company said yesterday it had received a number of offers.
"PowerTel has received incomplete, non-binding and highly confidential proposals from independent parties," the Sydney-based company said.
The Business Herald revealed on Wednesday that Telecom was negotiating to buy a blocking stake in PowerTel in order to deflect a potential takeover bid from rival Optus.
A deal is expected in the next month, but could be finalised within a week, according to a source familiar with the negotiations.
ABN Amro analyst Ian Martin said that a bid for PowerTel was AAPT's best chance to revive its struggling business so it would be a serious player in bidding negotiations.
AAPT needed to expand its infrastructure capacity if it wanted to remain competitive and PowerTel was the second-largest broadband network provider in the country after Telstra, he said.
Optus could make a bid for PowerTel to prevent PowerTel and AAPT merging and becoming a significant third retail fixed phone line provider.
PowerTel's board will consider the offers and independent advisers have been appointed to review the proposals, the company said.
Shares in PowerTel rose to a new high yesterday of A$2.14, up from A$0.98 in August last year. They closed at A$2.13.
AMP head of equities Guy Eliffe said Optus and Telecom would probably be the main bidders for PowerTel.
"They would just do calculations on what is a good return based on the incremental economics. If Telecom failed to take the stake it would continue to put in place strategies it has at the moment."
Telecom said that it was looking at options aimed at improving the performance of AAPT.
"At this stage, discussions are ongoing and no conclusions have been reached. This includes proposals which are incomplete and highly conditional."
AAPT has suffered a substantial decline in margins over the past year, which Telecom said had been driven by a rise in wholesale prices across all products from its wholesale supplier Telstra.
