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Telecom is expected to consider investing up to A$200 million ($231 million) in Australia as part of the refinancing of Hutchison Telecommunications.
Hutchison, which is controlled by Hong Kong billionaire Li Ka-shing, is soon to announce the findings of a review of its capital structure in an effort to ease its multi-billion-dollar debt burden.
Telecom chief financial officer Marko Bogoievski is understood to have told investors in Sydney last week that the company could contribute to a recapitalisation of Hutchison, in which Telecom has a 20 per cent stake, the Sydney Morning Herald reported today.
ABN Amro analyst Ian Martin said he believed Telecom could invest up to A$200 million in Hutchison because it valued the potential for a third-generation mobile operation on both sides of the Tasman.
Telecom paid A$250 million for a 19.9 per cent stake in Hutchison two years after its 1999 purchase of AAPT for A$1.5 billion. It contributed a further A$150 million to the Hutchison deal to build a 3G mobile-phone network.
Like the loss-making AAPT, the investment in Hutchison has proved challenging, which had debt of A$3.6 billion as at December 31.
- NZPA
