Rumours Telstra's axe set to drop

By PETER GRIFFIN

TelstraSaturn chief executive Jack Matthews was last night rumoured to be about to resign in a Telstra move to assert control over its loss-making New Zealand investment.

A deal that would see Telstra buy second-placed telco Clear Communications was also believed to have been held up by a last-minute glitch, possibly connected to the severance packages of Mr Matthews and key directors.

Mr Matthews is tipped to be replaced by Rosemary Howard, who has been managing director of Telstra's wholesaling division in Australia.

Last night TelstraSaturn's director of corporate development, Deanne Weir, confirmed that Ms Howard was in New Zealand meeting TelstraSaturn management.

But she said it was business as usual for Mr Matthews, who has been out of contact for several days.



She refused to comment on speculation surrounding Telstra's long talked-of purchase of Clear.

TelstraSaturn's director of sales and marketing Sean Wynne would not comment on "shareholder issues" and gave no clear indication of his plans with the company.

"I'm not sure who knows what the future brings but there are some very exciting days ahead for TelstraSaturn," said Ms Weir, who has been with Telstra for more than 10 years and is at present on secondment to TelstraSaturn.



Confirmation of a staff reshuffle at TelstraSaturn is expected within the week.

Under Ms Howard's leadership the company is expected to focus on its core telecoms business and shed its other activities.

That would leave little room for TelstraSaturn's cable TV business, believed to employ up to 300 people.

Industry sources believe such a withdrawal would not see all these jobs lost, because TelstraSaturn would seek a content partnership with Sky Television that would see programmes supplied in Wellington and Christchurch using TelstraSaturn's cable network.

Rumours abound that 500 to 800 jobs will be cut from a merged TelstraSaturn-Clear operation.