Aside from the aforementioned services, it is also involved in the provision of cable distribution and management of business information technology or telecommunication services. The company also provides wholesale services to other carriers, carriage service providers, and Internet service providers (Telstra Corporation Limited 1).
The company has made its IPO (initial public offering) in 1991. Currently, the company is under joint public/private ownership, with the Australian government holding 51.8% of its share as of the mid-2005 (Telstra 1). The privatization of Telstra has begun in the late 1990’s by the coalition government. However, full privatization which would mean divesting all the government’s shares had been blocked until the 14th of September 2005.
The true value of the company’s stock is currently under hot speculation from the different industry players. Experts assert that the company’s stock is overvalued as some financial information were revealed to the government, the company’s largest stakeholder yet remained concealed to the remaining 1.6 million shareholders. The company had allegedly borrowed US$500 million from its reserves to cover its dividend payout in 2005 and another US$2.5 billion for its dividend obligations in 2006. It was also reported that the company needs a minimum of US$3 billion cash outlay in order to rehabilitate its faulty lines. This investment is necessary as Telstra Limited Corporation had not been making investments to maintain its lines (Haynes 20-21).
This information significantly affected the value of the telecommunication giant as investors become wary of the true performance of the company and its future directions. During the first week of September, the market value of its stocks plunged to its lowest in two years. Stock prices further dipped reaching $4.00.
After its IPO in 1997, Telstra Corporation Limited has become a profitable investment in security, giving healthy