Telecom adds to credit line

Telecom, New Zealand's biggest listed company, has added a further $400 million to its bank credit lines which it says it will use to repay short-term debt and general corporate purposes.

The phone company said it had set up a two and three-year revolving credit facility with Westpac Banking in addition to its as-yet-undrawn $600 million syndicated committed standby credit facility established in April.

The new funding line will go towards repaying $420 million of debt coming due this year.

This month Telecom affirmed second-half earnings guidance of some $560 million as it persists with its focus on stripping out costs.

Earnings before interest, tax, depreciation and amortisation were $488 million in the first six months of the year.

That was the phone company's maiden result since it spun out its Chorus unit as a standalone entity last year, saddling the network company with $1.7 billion of debt in the demerger.

Telecom's shares closed up 4.5c yesterday at $2.535.