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iiNet: Business as usual with PowerTel

Perth-based upstart telco iiNet today claimed its close business relationship with PowerTel would not change, despite Telecom New Zealand's plan to buy PowerTel. "The proposed acquisition of PowerTel by Telecom New Zealand is not expected to affect the provision of services by either iiNet or PowerTel to the other party in any way," iiNet chief executive Michael Malone said in a statement to the Australian Stock Exchange this afternoon.
Written by Renai LeMay, Contributor

Perth-based upstart telco iiNet today claimed its close business relationship with PowerTel would not change, despite Telecom New Zealand's plan to buy PowerTel.

"The proposed acquisition of PowerTel by Telecom New Zealand is not expected to affect the provision of services by either iiNet or PowerTel to the other party in any way," iiNet chief executive Michael Malone said in a statement to the Australian Stock Exchange this afternoon.

PowerTel owns 18.3 percent of iiNet and has exclusive rights to sell wholesale access to iiNet's extensive ADSL2+ broadband network. But that stockholding is shortly to become owned by Telecom New Zealand, as the Kiwi telco announced yesterday its plans to buy PowerTel.

The acquisition is expected to result in a large third player in the Australian telecommunications landscape as Telecom consolidates PowerTel with its existing local subsidiary AAPT.

"Under the alliance agreement struck in May 2006 by iiNet and PowerTel, iiNet will continue to provide PowerTel with wholesale access to Australia's second-largest ADSL2+ network, and PowerTel will continue to provide iiNet with wholesale access to its fibre network," iiNet's statement said.

"In our opinion, this is a good move for PowerTel and AAPT, and the Australian telecommunications industry overall," said Malone. "We look forward to Telecom New Zealand becoming a major shareholder in iiNet".

Current PowerTel chief executive Paul Broad is also a member of iiNet's board.

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