(Updates with completion date in second paragraph.)
Oct. 26 (Bloomberg) -- Telecom Corp. of New Zealand shareholders today approved the split of the nation’s largest phone company, allowing network unit Chorus to partner the government in the ultrafast broadband program.
Investors voted 99.8 percent in favor of the demerger of Chorus at the annual meeting today in Auckland, the company said in a statement sent to the stock exchange. The split is likely to be completed by Nov. 30, the statement said.
Telecom proposed the structural separation to satisfy a government requirement that its partners in a NZ$1.35 billion ($1.1 billion) broadband project could not also sell telecommunications services. The split will be a world-first for the industry, Chief Executive Officer Paul Reynolds told the meeting.
“Today is an historic occasion,” Reynolds said on a webcast. “The rest of the world is watching with great interest.”
Chorus was accepted as a partner to deliver fast Internet in 24 regions including Auckland and Wellington, representing 70 percent of the nation’s coverage area, after the company announced its demerger.
Shareholders will get one Chorus share for every five Telecom shares they hold as part of the proposal. After the split, Telecom remains as a retail business, retaining ownership of its mobile network.
“Telecom will be a very significant company,” Reynolds said. “We will come out of the starting gates in number one or number two in all our key markets.”
--Editor: Edward Johnson
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