Verizon cuts its Telecom stake to 22.5pc

Telecom's largest shareholder, Verizon, formerly Bell Atlantic, said in a substantial security holder notice yesterday that it had cut its stake from 24.95 per cent to 22.5 per cent.

The sale, through Bell Atlantic Holdings, was valued at $103.2 million.

It said it had cut its holding between May 10 and September 25.

Under Part II of the Securities Amendment Act a substantial security holder (with more than a 5 per cent stake) must inform the exchange of every percentage point change in its holding as soon as it becomes aware of the change.

Mary Meyers, manager Market Information Services at the Stock Exchange, said she would refer the matter to the Securities Commission to investigate the non-compliance with regulations.

Verizon, formed by the merger of Bell Atlantic and GTE Corp, attempted to quit Telecom three years ago through a convertible note issue.

But the Bell Atlantic notes, maturing in April 2003, are dollars out of the money and it would need a huge rise in both Telecom's share price and the New Zealand dollar to cause noteholders to convert to shares.

Telecom chief executive Theresa Gattung said recently that the Verizon stake was likely to be sold either in bits or as a strategic stake.

Bell Atlantic Holdings was listed in Telecom's annual report as holding 423,128,639 shares. But yesterday's announcement said its holding had dropped to 417,828,639.

Telecom has 1.86 billion shares on issue.

- NZPA