Telstra to co-operate in ASIC probe

Telstra says it will co-operate with a probe by the corporate watchdog into
movements in its share price ahead of its National Broadband Network (NBN) deal
being announced.
There are concerns insider trading may have been behind a surge in the company's
share price late last week before a deal was announced on Sunday that will see it
participate in the rollout of the NBN.
More than $198 million worth of Telstra shares were traded on Friday in what was the
busiest day for the stock in two weeks. The company's share price closed seven cents
higher compared with the previous day.
The Australian Securities and Investments Commission (ASIC) will investigate the
movement in the share price after the matter was raised by opposition treasury
spokesman Joe Hockey.
A spokesman for Telstra said the company would cooperate with any ASIC probe.
"Telstra takes its disclosure obligations very seriously and will co-operate with an
ASIC inquiry," the spokesman said.
Mr Hockey raised the issue on Monday night with Corporate Law Minister Chris Bowen,
who in turn referred the matter to ASIC.
"I have not looked at the Telstra share price movements over recent days," Mr Bowen
said.
But he added that he was "very concerned" about the suggestion that there may have
been illegal trading in Telstra shares ahead of the NBN announcement.
"I make this point: the government takes these matters very seriously," Mr Bowen said.
Telstra on Sunday signed a deal to lease some of its infrastructure to NBN Co, the
company that will build and operate the NBN.
The deal, which will make the rollout of the NBN faster and cheaper, ended more than
12 months of negotiations between Telstra and the government.
It all but locks in Telstra's involvement in the NBN.
The deal, worth $11 billion to Telstra, is yet to be approved by shareholders.
Telstra's share price closed higher again on Monday on the back of the deal, surging
by more than three per cent, but gave up some ground on Tuesday, finishing eight
cents lower at $3.26.