(Adds value of agreement in first paragraph.)
June 23 (Bloomberg) -- Telstra Corp., Australia’s former phone monopoly, said it will receive about A$11 billion ($11.6 billion) for agreeing with the government to phase out the company’s copper telecommunications network and participate with NBN Co. in the rollout of the National Broadband Network.
The deal has a number of conditions and won’t have a material impact on Melbourne-based Telstra’s finances in fiscal 2012, the company said in a statement today to the Australian stock exchange. Telstra shares advanced 1.3 percent to NZ$4 as of 11:17 a.m. in Wellington trading.
“After rigorously assessing the options before it, including the regulatory and commercial implications of each, the Telstra Board expects to recommend that shareholders approve a proposal to participate in the NBN rollout, subject to the conditions precedent being satisfied,” Telstra Chairman Catherine Livingstone said in the statement
Telstra will have to lease access to the NBN’s A$35.9 billion network after it transfers control of its fixed-line grid to the government. The national network plans to connect to 93 percent of Australia’s population by 2018.
The plan to bring high-speed Internet to some of Australia’s remotest corners drew fire ahead of last year’s Aug. 21 general election for its cost. Gillard clung to power by forming a minority government with independent lawmakers from rural regions who welcomed improved services.
--Editors: Garfield Reynolds, Joe Schneider
Gemma Daley in Canberra at firstname.lastname@example.org
To contact the editor responsible for this story: Peter Hirschberg at email@example.com