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Telstra shareholders set to approve NBN split

Tuesday 18th October 2011

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Telstra’s shareholders look likely to approve the Australian phone company’s separation to allow its participation in the National Broadband Network after proxy and direct voting at the annual meeting today.

The resolution approving Telstra’s structural separation gathered 99 percent support from shareholders who voted or lodged a proxy, though the final result will be available later today, the company said in a statement.

“It is clear from this interim result on the resolution that, given the alternatives facing their company, both institutional and retail shareholders are supportive of our involvement in the NBN,” chairman Catherine Livingstone said.

“The NBN will accelerate industry change. That is why, across the company, we are well advanced in preparing for both the change and the opportunities it will create.”

The Telstra separation is similar in its intention, but produces a different outcome, to the separation that Telecom shareholders in New Zealand will vote on next month to split Telecom’s Chorus infrastructure unit from its retail business.

In July, Telstra rejigged its business structure to pave the way for the new Australian model, wrapping its sales and retail customer workforce into a single business unit, appointing a permanent managing director to its wholesale unit as it prepares to split into a separate company, and launching a new technology research unit.

In 2006, former Telstra head Sol Trujillo claimed rules to open access to its copper and fibre network would destroy the company’s value. Telstra’s shares rose 1 percent to $4.04 on the NZX and gained 1.3 percent to A$3.15 on the ASX.

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