Telecom NZ sells Yellow Pages for$NZ2.24 billion

Stuart Corner
Monday, 26 March 2007 05:54

IT Industry - Deals

Telecom New Zealand is to sell its Yellow Pages Group to a private equity consortium consisting of CCMP Capital and Teachers’ Private Capital for $NZ2.24 billion.

The figure is at the high end of expectations but includes the group's receivables which will be retained by Telecom. Telecom will receive $NZ2.165 billion in cash for the business.

Telecom expects the transaction to be completed by the end of April subject to Overseas Investment Office approval and normal closing conditions. Telecom intends to tell shareholders how it plans to use the cash at its third quarter profit announcement on 3 May 2007.

The Yellow Pages Group includes the printed Yellow Pages, White Pages and their on-line equivalents, local directories, New Zealand Retirement Guide and New Zealand Tourism Online, purchased in August 2006.
 
Telecom announced plans to sell the business  last November following a scoping study and a review by the board which had concluded that a sale would be in the best interests of the Telecom Group and its shareholders in the longer term.

This was in stark contrast to Telstra which sees Sensis, which incorporates its Yellow Pages business, as a major contributor to growth and the source of strong synergies with the rest of its business.