One of Telstra Corporation Ltd’s
(ASX:TLS) largest shareholders is poised to lead an investor revolt against the federal government’s national broadband network (NBN).
Listed fund manager, the Australian Foundation Investment Company Ltd (ASX:AFI), has warned Telstra shareholders not to be short-changed by selling the company’s fixed-line business to the government’s $43 billion broadband network.
In a presentation to investors, the fund manager also questioned the need for a large investment in the national broadband network.
Managing Director Ross Barker says Telstra is entitled to get appropriate value for its assets and shareholders deserve a fair outcome.
Mr Barker says one of the main dangers of the government’s plan is that the national broadbank network could easily become a new state-legislated monopoly.
Telstra is refusing to be cornered by the government, pledging that any agreement for the sale of its fixed-line business to the national broadband network will have to gain shareholder approval through a formal vote.
In the 12 months to June 30, 2009, Telstra booked a profit of $4.073 billion.
