special deal for tls holders

Special deal offer to Telstra holders

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By Michelle Grattan
August 28, 2006
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Existing Telstra shareholders will get favourable treatment in the coming T3 float, the Federal Government pledged yesterday.

It is not revealing how they will benefit but options include the right to subscribe for additional shares, a discount on the share price, bonus shares, and a guarantee of being assured of a certain minimum allocation of shares.

Finance Minister Nick Minchin said the Government had in mind some entitlement for existing shareholders and details would be revealed closer to the offer.

But Senator Minchin would not send a direct message urging people to buy T3 shares, a contrast with John Howard's enthusiastic salesmanship of T2 in 1999.

Asked on Nine's Sunday whether buying into T3 would be an extremely good deal, Senator Minchin said he was prevented by law from being a "spruiker" for the share offer.

"I am not a licensed financial adviser. The message that we will be putting out there is that potential investors need to talk to their own financial advisers about whether T3 is an attractive offer for them, depending on their particular circumstances. Obviously we will seek to make it an attractive offer."

Mr Howard said of T2 at the time that "it is a marvellous opportunity for more of the mums and dads of Australia to buy shares in this great enterprise".

Senator Minchin said "T2 is T2, that was seven years ago". He was dealing with 2006, and there had been changes to the law about giving financial advice.

He denied Mr Howard had sucked people into the earlier float. Those who participated then "did so knowingly and willingly and under no duress".

Opposition finance spokesman Lindsay Tanner said the Government was not only dumping shares on a falling market, it was not even prepared to advise people to buy them.

He said that because of Mr Howard's political needs "everyone's a loser - Telstra shareholders, the taxpayer and telecommunications users".