CREDIT: TEL: S&P puts Telecom on creditwatch negative

5 Aug 2010 8:30 am

TEL 05/08/2010 CREDIT

REL: 0830 HRS Telecom Corporation of New Zealand Limited (NS)

CREDIT: TEL: S&P puts Telecom on creditwatch negative

STOCK EXCHANGE ANNOUNCEMENT

4 August, 2010

S&P PUTS TELECOM ON CREDITWATCH NEGATIVE

"Standard & Poor's Ratings Services said today that it had placed its 'A/A-1' ratings on Telecom Corp. of New Zealand (TCNZ) and its related entities and debt issues on Creditwatch with negative implications.

"This rating action followed TCNZ's announcement that it has submitted a proposal to Crown Fibre Holdings to structurally separate TCNZ's fixed line access network from its remaining businesses," said Standard & Poor's.

Russ Houlden, CFO, Telecom, said that: "We believe that Telecom's proposal to Crown Fibre Holdings aligns the interests and incentives of Telecom, its shareholders, the Government and New Zealanders. We remain committed to Telecom maintaining single A credit ratings with both Moody's and Standard & Poor's." - ends - Contact:

For media queries, please contact: Mark Watts Head of External Media +64 (0) 27 250 4018

For investor relations queries, please contact: Stefan Knight Investor Relations Manager +64 (0) 27 252 9438 End CA:00198021 For:TEL Type:CREDIT Time:2010-08-05:08:30:49

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