Chorus Surges Most on Record on Price Reprieve: Wellington Mover
Chorus Ltd. (CNU), New Zealand’s biggest telephone network operator, rose the most on record after the government delayed proposed cuts to its wholesale Internet pricing pending a review of industry regulation.
The review, which was previously required to start by September 2016, will commence immediately, Amy Adams, Minister for Communications and Information Technology, said in an e-mailed statement. The regulator can’t enforce proposed cuts to the price Chorus charges for broadband access until the review is completed, by Nov. 30, 2015, at the latest, she said.
Chorus rose 10 percent in Wellington trading, the biggest daily increase since the company split from Telecom Corp of New Zealand Ltd. and listed separately on Nov. 23, 2011.
“One common message I have continually heard from consumers and industry is that they want certainty,” Adams said in the statement. “The policy framework needs to be predictable and stable for all concerned.”
Chorus fell the most on record in December when the Commerce Commission said in a draft recommendation that monthly prices for so-called unbundled bit-stream access on its existing copper-based network should be cut by about 28 percent to NZ$32.45 per line from Dec. 1, 2014. The regulator’s decision was to be finalized in June this year.
Chorus shares rose 29 cents to NZ$3.15 at the 5 p.m. close of trading in Wellington.
New Zealand’s government is building a high-speed broadband network throughout the nation that will be fiber-based. Chorus, which is a partner in the project, said last year it was concerned that price cuts to copper-based services would deter uptake of fiber services.
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