Telecom New Zealand has confirmed it will be making its 60 per cent stake available to local bidders.
“Yes, we are planning to advertise locally shortly,” said Richard Llewellyn, Head of Corporate Communications.
Telecom NZ has entered into an agreement to sell its majority shareholding to Digicel for about $23 million, subject to a number of conditions. The remaining shares are held by the Cook Islands Government.
Before Telecom NZ can sell those shares to Digicel, it must comply with strict rules governed by the Business Trade Investment Board (BTIB).
“The vendor Telecom NZ needs to demonstrate to the Board that it has taken reasonable steps to offer to Cook Islanders first the shares or proprietary interests it is selling,” said Teariki Vakalalabure, BTIB’s Manager of Foreign Investment and Compliance.
He said Digicel is required to submit an application for registration as a foreign enterprise, which must be filed before the 15th of the month.
“We have met with Digicel officials and have discussed this with them.”
Telecommunications Minister Mark Brown said he believes Telecom NZ will be advertising the shares within the next week.
He said there would be nothing stopping a local consortium from making an offer.
“Telecom have told me they will have a look at serious offers that do come in and they will have to do due diligence.”
Any bidder would need to have sufficient capital and be able to show a good track record in the telecommunications sector, Brown said.
Frank O'Carroll, Digicel’s Vice President of Business Development, said his company is more than happy to be patient and comply with the local rules.
“This is one of the largest sales of a company in Cook Islands history and we are very respectful of that process.”
He said Digicel cannot stop a local individual, business or consortium from making an offer.
“We took the initiative and did that. If some local person can prove they have deeper pockets and the ability to run the company, why wouldn’t they?”
One person who has expressed interest in competing with Digicel for the shares is local businessman William Framhein, director of Mervin Communications.