iiNet to buy AAPT from Telecom NZ

AAP

INTERNET service provider iiNet Ltd has agreed to buy AAPT for up to $60 million from Telecom Corporation of New Zealand Ltd.

The deal would also see Telecom NZ sell down its 17.4 per cent holding in iiNet to institutional investors, The Australian reported on Friday.

Telecom NZ will sell iiNet AAPT's retail business after deciding to split the business after bids for the combined business fell well short of the $300 million asking price, the paper said.

Investment bank Goldman Sachs JBWere would place Telecom NZ's holding of iiNet shares with institutions at a price expected to be about $2.40 to $2.50 a share.

iiNet shares last traded at $2.65 a share before entering a trading halt on Thursday. The company said in a statement that it was going into the trading halt pending an announcement on a potential acquisition.

Telecom NZ would retain the wholesale fibre division of AAPT for a possible sell off into the national broadband network at a later date, The Australian said.