CBA takes a bite of Telecom Corp Australia

Monday 28th August 2000

Telecom New Zealand announced that the Commonwealth Bank has taken a 5 per cent equity stake in Telecom Corp. NZ Australia with an option to take up to 35 per cent over the next five years.

It was also announced that the CBA's A$500 million telecommunications services contract has been signed with Telecom Corp. of New Zealand. This outsourcing contract was first signalled on July 18th, however was still not finalised at that date.

Under the agreement, Telecom Corp. NZ Australia (TCNZA - a fully owned subsidiary of Telecom Corp. NZ) will use the services of AAPT, Comtech and EDS. TCNZA will streamline the CBA's existing telecommunications infrastructure into a single internet protocol network supporting a full range of integrated data, voice and video services.

Telecom CEO Theresa Gattung said that TCNZA will have an excellent opportunity to interface with the CBA's existing alliance partners and package solutions to the CBA's customer base.

"TCNZA will provide a seamless service, with a single point of accountability to the Bank, that will enable links and integrations across the CBA's 1100 branches, around 4,000 agencies, 100,000 Eftpos terminals and 9 million customers" Ms Gattung said.

It is hoped that the contract will expand the CBA's access into new markets and improve the bank's ability to provide a "one stop shop" for telecommunications services.

Telecom's share price has been hammered in recent weeks as the market reacted negatively to New Zealand's economic situation, the low dollar, how Telecom will finance the takeover of AAPT and fears of increased competition.

Telecom was up this morning after buyers believed the company was oversold last week and the market reacted positively to the CBA contract news.

Comments from our readers

No comments yet