Telstra and Nokia have made a big investment of $100 million into Australian telecommunications company Telstra.
Key points:Nokia will take a 50 per cent stake in the company while Telstra retains 50 per in a deal with Telstra Capital, a fund run by former Nokia CEO Stephen Elop and other investorsThe investment will help build the network of a billion-plus users to compete with Telus, which has a network of about 10 million users and a market capitalisation of $2.7 billionThe deal was first reported by the Wall Street Journal, which said the two firms were in talks with the government to merge the two companies, and it has since been confirmed to the Financial Review.
“We have made this investment to ensure we have a strong, high-quality telecommunications infrastructure that enables us to compete and be competitive with our global competitors,” Telstra CEO Andy Penn said.
“The synergies we will enjoy in this investment will create a global network of millions of customers.”
Telstra said it would retain a 50.5 per cent share in Telstra in the deal, while Nokia will retain a 25 per cent ownership.
“This transaction represents a significant contribution to our future success and I am confident that it will have an enduring impact on Telstra’s future success,” Mr Penn said in a statement.
“I have been proud of our long and proud relationship with Nokia, and I will continue to be a strong advocate for our shared values.”
“We are very pleased to have worked with Telra and will continue our strong collaboration in the telecommunications sector,” Mr Elop said in an email to the company’s shareholders.
The deal is expected to close in the second half of 2019, with a completion date of mid-2020.
Topics:telecommunications,business-economics-and-finance,technology,information-and.communication-technology,business,technology-and_science,government-and/or-politics,business/economics,australiaContact Tracey McDermott