United States investors have been reducing their stake in Telecom in anticipation of its split with Chorus, according to the Wall Street Journal.
Chorus, Telecom's network and infrastructure business, is on the verge of becoming a separate public company to take part in the Government's ultra-fast broadband scheme.
Chorus will receive $929 million of taxpayer funds to roll out high-speed fibre internet cables in 24 towns and cities across New Zealand over the next eight years.
Chorus will be a wholesaler and own 130,000km of copper lines, more than 27,000km of fibre cables and more than 500 telephone exchanges while Telecom will become a stand-alone retail business and keep hold of its mobile network.
Both companies will have their own listings on the New Zealand and Australian stock exchanges.