Govt slammed for ‘passive compliance’

Wednesday April 02, 2014 Written by Published in Technology
William Framhein, director of Mervin Communications, Kukicel and Matariki FM radio station, believes Telecom Cook Islands should stay in local hands. 14021808 William Framhein, director of Mervin Communications, Kukicel and Matariki FM radio station, believes Telecom Cook Islands should stay in local hands. 14021808

Local businessman William Framhein is furious that the Government is allowing Telecom Cook Islands to pass into the hands of global telecommunications company Digicel.

Telecom NZ (TNZ) has entered into an agreement to sell its 60 per cent stake in Telecom Cook Islands (TCI) to Digicel for about $23 million.
The agreement is subject to a number of conditions and is expected to complete by May 31.
Framhein, Director of Mervin Communications, said the Government has the right to buy TNZ’s shares and should be doing so.
“We now have the opportunity for Cook Islanders to take back control of TCI, but Telecommunications Minister Mark Brown seems hell bent on allowing this strategic asset to pass into the hands of an operator far more ruthless and litigious than TNZ.”
Brown says the Government has no interest in expanding its 40 per cent shareholding in TCI to 100 per cent ownership.
Framhein has asked the Government to reconsider and to facilitate a purchase of the shares for on-selling to Cook Islanders, such as Mervin Communications.
As an alternative option, Framhein has asked Government to assign its first right of refusal over to Mervin, subject to TNZ’s approval.
Brown says he has been advised by Crown Law that passing on the Government’s right to a third party would not be legal.
“But the Minister didn’t even have the guts to write to Craig Walton, Head of Telecom New Zealand, and ask him if an assignment would be possible,” Framhein said.   
Framhein wrote to Brown in February asking nine questions, such as what kind of comfort he would be looking for from Mervin to change his stance on waiving the first right of refusal.
He also asked Brown whether Mervin’s equity investors and funding sources would be given the chance to perform due diligence on TCI.
Framhein said Brown’s decision to answer only one question out of the nine “is disgraceful and irresponsible”.
Brown has no idea what the financial and social impacts will be of “his passive compliance with this deal”, Framhein added.
Digicel and TNZ have both refused to disclose what the conditions of their agreement are.

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