Reuters | By Narayanan Somasundaram and Adrian Bathgate | December 22, 2010
* Telstra to take $138 million writedown on China business
* Telstra says other Asian investments performing well (Adds details, background)
SYDNEY/WELLINGTON Dec 23 (Reuters) – Telstra Corp , Australia’s dominant phone company, will take a write down of A$138 million ($138 million) as the result of a review of its Asian businesses, but its guidance remained unchanged.
The writedown affects its 67-percent owned Octave business in China, with Telstra saying its other Asian assets are performing well, and it noted it would book a gain of $65 million from the IPO of SouFun , China’s largest online real estate firm.
“Neither the SouFun gain nor the Octave impairment will affect guidance, which explicitly excluded asset impairments and proceeds from asset sales,” Telstra said in a statement.
Telstra acquired a 67 percent stake in Octave, which provides mobile content and services in China, for A$259 million in February last year.
The Octave writedown was blamed on regulatory rulings in China that were expected to constrain the wireless application protocol (WAP) market, which has caused a rethink of the company’s business plan, Telstra said.
The company has other investments in mobile and Internet in both Hong Kong and China, which it said were performing well.
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UPDATE 1-Telstra takes write down in China, guidance unchanged
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