Telecom's content play: a little bit of INL

Telecom late yesterday revealed itself as the mystery buyer of shares in INL, spending $94.6 million on 5.7% of the Murdoch-controlled media company.

Telecom late yesterday revealed itself as the mystery buyer of shares in media group INL.

The company purchased 21.2 million shares at $4.25 per share overnight on Wednesday and remained in the market yesterday, taking its holding to 22.3 million shares, or 5.7% of INL. The total purchase cost about $94.6 million.

INL is controlled by Rupert Murdoch's News Corporation and owns more than half of Sky Television.

Telecom CEO Theresa Gattung said the company had been aiming for a shareholding "somewhere between 5 and 10%" and was comfortable with where it had ended up.

She described the stake as "indicative of a small, strategic position, which will allow us to build a closer relationship over time.

"It is further evidence of Telecom's transition from a traditional telecommunications company to a serious online and solutions player," she said. "It is also a good fit with other strategic initiatives, including the EDS, Microsoft alliance and the investment in AAPT.

"We are operating in a converging, global industry, with several world players in New Zealand. This represents a sound investment for us, with good prospects for the future."

The stake in INL comes as INL prepares an Internet offering based around its newspapers and the Dominion in particular. The development task may open the way for a practical synergy, with INL basing its efforts on the powerful but demanding content platform Vignette Story Server - a platform now tamed and working well for Xtra.

The move also brings Telecom closer to Sky Television as the pay-TV operator launches its new interactive services division and prepares to offer email services to its digital TV customers.

It has been a busy week for Telecom and its subsidiaries. Last Friday, Xtra and announced what is effectively a custom version of FlyingPig's new affiliates scheme, which pays commissions of up to 15% for sales delivered to it by other Websites.

Under the long-term agreement, Xtra named FlyingPig as its "preferred merchant of key retail categories" - basically shuffling off the practical elements of sales and fulfilment to FlyingPig and taking the commission instead.

Then, on Tuesday, AAPT, the Telecom-owned Australian telecommunications company, told the Australian Stock Exchange that it was in discussions with America Online (AOL) over AOL Australia, but "the pricing and timing of any transaction which might result from these discussions have not been finalised."

The following day, AAPT announced it was selling its satellite services subsidiary Sat-Tel to the global operator New Skies Satellites for an undisclosed amount. The funds from the sale will be used by AAPT to finance other strategic investments for AAPT, while AAPT will lease satellite services from New Skies.

Join the newsletter!


Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.
Show Comments