The TelstraClear brand is due to be phased out in the next 18 months following the Commerce Commission approving Vodafone's takeover the company.
The commission gave the green light to Vodafone's $840 million takeover of TelstraClear yesterday morning. Although the sale was announced in July it needed permission from the regulator before it could go ahead.
While the two operations will remain separate for half a year, they will be brought together under the Vodafone brand within the next 18 months.
Vodafone New Zealand chief executive Russell Stanners will lead the larger company, while existing TelstraClear head Allan Freeth is stepping down and will have his last day tomorrow.
Freeth, whose departure was announced yesterday, has been chief executive of TelstraClear since 2005.
TelstraClear chairman Gordon Ballantyne said the company had grown from a fledgling challenger to a major profitable player under Freeth's leadership.
"Allan has also played a key part in the sale of TelstraClear to Vodafone NZ, which we expect to complete shortly," Ballantyne said.
"We thank Allan for his commitment and effort over the seven years he led the company and wish him all the best for the future."
A Vodafone spokesperson said yesterday there would be staffing "overlaps" when the merger takes place, but could not comment on how many people could be made redundant as a result.
"We now need to look at the two business units to determine the best overall structure to best support our customers," the spokesperson said. "Until we've done that review it is too early to speculate on jobs."
At present Vodafone has around 1900 staff while TelstraClear has 1300.
According to commentators, the takeover will give Vodafone more clout to challenge Telecom.
Telecommunications Users Association of NZ chief executive Paul Brislen said the country would "finally have a competitor that can take on Telecom in the fixed line market".
In approving the takeover, the commission said it did not find any significant business overlap between Vodafone and TelstraClear in the provision of either mobile phone services or fixed line services to large businesses.
"In reaching its decision, the Commission considered that the merged entity would continue to face competition from Telecom, as well as Orcon, Slingshot and other smaller businesses in providing fixed line voice and broadband services to residential and small business customers," said Commerce Commission chair Mark Berry.
Research from AUT University released last year suggests Telecom has a 49 per cent share of the home broadband market, while TelstraClear and Vodafone have 16 per cent and 13 per cent respectively.