It can be fairly argued that we cover New Zealand news a bit closer because a) this reporter's wife is a Kiwi, and b) it's the most beautiful place on earth, but beside all that, New Zealand's telecom industry is one of the most robust on earth:
Telecom Corp. of New Zealand, whose dividend yield is twice
that of Verizon Communications Inc., agreed to sell a media investment to
Rupert Murdoch's News Corp., boosting its ability to increase payments to
New Zealand's largest telephone company plans to sell its 12
percent stake in Independent Newspapers Ltd., a cashed-up former publisher, to
News Corp. for NZ$6.19 a share, or NZ$272 million (US$198 million), Telecom
said in a statement in Wellington today.
Telecom raised dividend payments this year to 85 percent of
earnings from as little as 50 percent after the company slashed debt it had
used to expand the past three years. Telecom, whose stock has an indicated
gross yield of 8.9 percent, has said it may pay special dividends should it
have excess cash.
"They have got reasonable capacity to pay some sort of
increased distribution and this helps,” said Jeremy Simpson, an analyst at
Forsyth Barr in Auckland, who rates Telecom a “buy.” The brokerage is New
Zealand's largest for private clients.
Shares of Telecom rose 0.8 percent to NZ$6.06 at the 5 p.m. market close in Wellington. The stock's 1.5 percent decline this year lags a 2.7 percent drop in the benchmark NZSX 50 Index. Of 12 analysts who follow the stock, eight rate the stock a ``Buy'' and four a “Hol."
Chief Executive Theresa Gattung, 43, whom Fortune magazine ranked the 32nd most powerful woman in business outside the U.S. in 2004, said a year ago that the company may consider special dividends. The sale of the Independent Newspapers stake will reap a profit of NZ$86 million, the company said today.