[AusNOG] NBN - Negotiations with Telstra - update from DeLimiter

[Nathan Sullivan]

Interesting...

The main interesting part of that equation would be how long does the Govt
have to "hold" Telstra and repay debt to facilitate the split into InfraCo
+ other entities before it can sell them off and repay debt/s... in terms
of time = interest payable. 6 months? 12 months?

Theres probably a lot of legacies, in terms of systems, asset registers,
payroll splits that would need to be dealt with during that time.

Nathan.

On Mon, Sep 9, 2013 at 4:17 PM, Matthew Moyle-Croft <mmc at mmc.com.au> wrote:

> Also,
> Govt already promised to pay Telstra ~$11B or so to move customers
> across - if buying Telstra and splitting it costs you that or less,
> then you're winning.
>
> On Sun, Sep 8, 2013 at 10:20 PM, Matthew Moyle-Croft <mmc at mmc.com.au>
> wrote:
> > On Sun, Sep 8, 2013 at 8:29 PM, Martin - StudioCoast
> > <martin.sinclair at studiocoast.com.au> wrote:
> >
> >> What are others thoughts on this? What other cost saving measures are
> out
> >> there?
> >>
> >
> > Go the insane private equity (but government) approach:
> >
> > 1. Borrow money from markets on short term basis to repurchase Telstra
> > from existing shareholders. (need AU$60Billion + premium).
> > 2. Break Telstra down into component parts - including one
> > owning/running the last mile (Cu, ducts, Exchange buildings, HFC etc).
> > "InfraCo"
> > 3. Sell all the bits other than InfraCo - probably worth about the
> > right amount to pay back money borrowed as no longer encumbered with
> > ugly bit of last mile that needs mucking with, if not, lumber Infraco
> > with the debt.
> > 4. Setup InfraCo to do what it needs to building whatever you need to
> > build.  It owns everything it needs and is govt owned.  No negotiating
> > with anyone.  Don't have to argue about technologies etc.  It can have
> > a look at what it's got and do what it needs to do relative to a
> > political dictum about services it needs to provide.
> >
> > So, money's pretty cheap to borrow internationally for short term.
> > Australia has AAA ratings so borrowing it should be pretty
> > straightforward.  InfraCo remains initially government owned so AAA
> > rating is fine.
> >
> > Given the "cost" is really just what the difference is between
> > acquiring Telstra and then selling the bits InfraCo doesn't need it's
> > probably cheaper.  Infraco starts with a customer base so you just set
> > it up so it can afford to roll out high speed over X timeframe.  Also
> > means that if you want to sell it then you have no issues other than
> > selling a govt monopoly which is a problem we already have.
> >
> > MMC
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