The final Telstra stake moved to the fund is worth about $8.9 billion and represents the residual shareholding that was not allocated last November in the T3 offer.
Finance Minister Nick Minchin said the transfer of the shares to the Future Fund represents the final step in the full privatisation of Telstra. The Future Fund was set up after the 2004 federal election as an investment arm to deal with ageing population issues, specifically government’s unfunded superannuation liabilities.
The transfer of the remaining Telstra shares also relieves Government of being both the industry regulator and a major shareholder of the industry’s dominant player.
Senator Minchin said the Telstra share’s transferred to the fund would be held in escrow for two years. Any sell down decision thereafter would be an arms length decision made by the Future Fund Board.
He also said the investment performance of the Future Fund would be judged independently of its Telstra shares until the Telstra stake could be reduced to a level that did not dominante the fund.
“The transfer also finally ends the Government’s untenable conflict of interest as the regulator of telecommunications companies and the owner of Telstra,” Senator Minchin said in a statement.
“I have also issued a Ministerial Direction to the Future Fund Board of Guardians today to reflect the two year escrow period for the Fund’s Telstra shareholding, subject to the limited exceptions outlined in November’s T3 prospectus.
“With the sale of the Government’s shareholding in Telstra now complete, the benefits of a privately-owned Telstra are increasingly evident. All Australians are benefiting from a reinvigorated Telstra investing in better networks and competing vigorously for customers, Telstra’s shareholders are seeing their investment increase in value, and all taxpayers are benefiting from the sale returns,” he said.
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