Telstra drops rule book on cheeky Kiwi takeover bid

Telstra yesterday confirmed it had received an unsolicited offer from a New Zealand company on October 18, 2004, but has labelled it as a hoax.

King Wan Laurel International made the offer to acquire all the shares in Telstra, including those shares held by the Commonwealth of Australia. Telstra is worth about A$60 billion ($63.8 billion).

It said yesterday it had not had previous contact or dealings with King Win Laurel International.

"The offer would appear to face a number of insurmountable hurdles, including the provisions of the Telstra Corporation Act that require the Commonwealth of Australia to hold at least 50.1 per cent of the shares in Telstra, and that no individual foreign person or company holds more than 5 per cent of the non-Commonwealth owned shares in Telstra," Telstra told the Australian Stock Exchange.

"The offer does not meet the requirements of the Corporations Act with respect to takeovers and appears likely to be a hoax."

But the head of the King Wan Laurel International has told The Sydney Morning Herald that he is confident the bid will succeed.

"I'm confident that Telstra will become my personal company," Xiufeng Zhang said.

Zhang said his company was bidding A$74 billion for the partly privatised Telstra, comprising A$45 billion cash and the remainder in debt.

"The money is not a problem," he told the the paper.

- AAP