Big Telecom bid in doubt

SYDNEY - NTT DoCoMo, Japan's biggest cellular phone company, will not bid for the mobile phone assets of Sydney-based Cable & Wireless Optus, the Australian newspaper reported.

NTT DoCoMo's withdrawal from the $A17 billion ($21 billion) sale process leaves New Zealand's Telecom without a bidding partner - and struggling to find the backing to go it alone.

Its share price fell 11c to $4.87.

Telecom's hopes of buying Optus' mobile assets had probably fallen over, said John Norling of AXA NZ Funds Management. "They really needed NTT in there to bridge the [funding] gap."

UK-based Cable & Wireless, which owns 53 per cent of Optus, wants to sell its consumer mobile and cable assets so it can focus on corporate and Government customers. Optus is Australia's biggest phone company, after Telstra.

"We are still interested" in Optus' mobile assets, said Telecom spokeswoman Linda Sanders, although she declined to say whether DoCoMo is a partner in a bidding for the Optus assets.

The newspaper stories "are obviously speculative and we don't comment on speculation," she said.

NTT DoCoMo took a similar stance: "We have absolutely no comment on this report since we never made any official comment expressing interest in Optus," said NTT DoCoMo spokesman Norio Hasegawa.

Also interested in Optus' assets are London's Vodafone Group and Singapore Telecommunications.

Singapore Telecommunications SingTel, which is looking to expand outside its island state, has $3.5 billion in cash and almost no debt after selling some European assets. SingTel at present has senior executives in Sydney examining Optus' assets.

While a late entry of NTT DoCoMo in the race for Optus had not been ruled out, DoCoMo was instead looking to buy Hutchison Telecommunications (Australia), the Australian said, citing "rumours circulating in the market."

Hutchison Australia is 58 per cent owned by Hong Kong's Hutchison Whampoa.

Optus had a "number of interested parties operating at different levels of interest" in the bidding process, said Optus spokesman Steve Wright.

There were no preferred bidders at this stage, he said.

Cable & Wireless has said it wants a decision by the end of March.

Optus shares fell 10 cents, or 2.7 per cent, to $A3.66.

- NZPA