Reuters – Australia’s biggest phone company Telstra Corp. is in advanced talks with a U.S. private equity firm over the sale of its Sensis directories business for as much as A$3 billion ($2.7 bln), local media reported on Saturday.
The Melbourne-based telco could complete the sale of its unit that publishes a range of print and online directories including the White Pages and the Yellow Pages to an unnamed U.S. firm as soon as next week, the Australian Financial Review reported, citing unidentified sources.
A Telstra spokeswoman declined to comment.
Telstra reported a 13 percent rise in net profit after tax of A$3.9 billion for the year ending June 2013, compared with A$3.4 billion a year earlier, underpinned by growth in its mobile business.
The company’s Sensis unit generated earnings before interest, taxation, depreciation and amortization of A$571 million for the same period, down 22 percent from the previous year. Chief Financial Officer Andrew Penn told investors at the August results briefing that the transitioning of the Sensis business to a digital model “remains a challenging one”.
The sale of Sensis would further boost Telstra’s cash war chest to more than A$8 billion to invest in new growth businesses and technology services and to expand its mobile network and leading share of the Australian mobile market.
Last month the company sold its Hong Kong mobile phone business for $2.4 billion to HKT, a company controlled by billionaire Richard Li.
Goldman Sachs is advising Telstra and Gresham is advising the U.S. firm, the newspaper said.
(Reporting by Morag MacKinnon; Editing by Jeremy Laurence) nL3N0KL02M