Telecom NZ shows no signs of selling AAPT

Stuart Corner
Thursday, 27 May 2010 14:44

IT Industry - Strategy

AAPT CEO, Paul Broad has delivered a bullish prognosis for the company's fortunes, despite significant revenue declines and despite Reuters reporting unequivocally that parent Telecom NZ was in negotiations to sell the company to TPG.

Broad presented on AAPT at Telecom NZ's investor day today, 27 May, saying that the company would aim to deliver a turnaround in EBITDA through cost reduction and simplification and the retention of high value customers and that AAPT's core IP/MPLS network and associated fibre access assets would position the company for success in winning data/Internet opportunities post NBN.

However the presentation from Telecom NZ CFO, Ross Houlden, did canvass the possibility of a sale, noting that all financial projections assumed the retention of AAPT.

Reuters confidently reported in April that Telecom NZ had accepted bids for AAPT from TPG Telecom, Pacnet, Optus and private equity firm Quadrangle Group. On 9 May Reuters reported that TPG had trumped the other bidders and was in negotiations to complete the acquisition.

Broad told investors that, since FY08, AAPT had suffered a 28 percent decline in overall revenues with declines in all divisions, but mostly in its consumer division, where forecast revenue for FY11 is only half of FY08 revenue.

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