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Thursday, March 30, 2006

Several weeks ago Netherlands based company Mittal Steel made a takeover bid for Arcelor, prompting legislation from Luxembourg (5.6% owners of Arcelor, the largest stockholders) and cries of discrimination from India.

Mittal is owned by the world’s fifth wealthiest man, Laskshmi Mittal, an Indian. After the takeover bid, the Luxembourg Chamber of Commerce attempted to introduce new rules that would stop companies with less than 25% of their shares in free float from making a cash and bid offer for a company whose location is in Luxembourg. India news reports then claimed that this was a discriminatory action because Laskshmi Mittal is an Indian.

Luxembourg officials have disputed this, stating that their actions were only due to the need to comply with EU legislation. The country’s minister for economy and foreign trade, Leannot Krecke, stated, “The government will have no role in impeding the bid. We intend to bring the takeover bill in May to put in the best international practices in our economy.” Krecke also stated that a similar bill will have to be brought to the national governments of each of the 25 EU member nations so that they complied with EU legislation.

Word of New Delhi’s displeasure with Luxembourg’s stance seems to have been translated to Luxembourg during a meeting that the finance ministers of both countries had in India.

Meanwhile, Mittal has announced that it is prepared to cut the cash portion of its buyout offer. Mittal will do so if Arcelor increases its dividend to shareholders above the 80 cent market consensus. A spokesman for Mittal stated: “If Arcelor decides to distribute extra cash to shareholders, we will consider that as an advance payment on our offer and adjust the cash component of our offer accordingly.”

Monday, November 13, 2006

Internet service provider (ISP) and telephone provider, Orcon Internet Limited, is going to start to provide television channels via super-fast broadband right to the customers television set. The service will be rolled out sometime next year after Telecom New Zealand has opened its lines to the competitors.

The high speed internet Orcon wishes to use is called VDSL2+ which is able to go 100 megabits per second; this is an upgrade of Telecom’s current technology, ADSL 2+. The new technology will be able to be installed when the government has opened up Telecoms lines to other ISPs. Scott Bartlett, regulatory manager of Orcon, said: “If we left this to the big telcos we wouldn’t get VDSL2+ for 5-10 years. We don’t have an existing legacy framework that limits us, so we can leap-frog them in terms of technology.”

The television channels/programmes will be delivered in high definition via IPTV, or Internet protocol television, to a set-top box, similar to those of Sky Network Television, connected to broadband.

Orcon has invested NZ$30 million into the new television service, they will be teaming up with Siemens to deliver the new television system.

Mr Bartlett said: “We are pitching to a market segment who were not necessarily totally nuts about watching the rugby live but still wanted high-definition quality television delivered by broadband.”

Orcon already has 52 channels secured, they channels will include the genres of comedy, science-fiction, news, music, weather and speaciality language channels. The movies will cost $1.00 each. And for $25 customers will be able to buy 25 channels or for $30 there will be 52 channels. For Sky television it costs $15 a week for an entry level package. “We don’t believe we have a monopoly and every channel known to man, we just think we have the ones that are important to New Zealanders,” the chief executive of Sky, John Fellet, said.

Mr Fellet said they “would like to partner with Orcon and deliver our channels over Orcon’s service, but if that did not happen, we are looking forward to competition heating up. Compete with us, that is fine. If you want to take our core product and add options yourself, that is an option as well. We have rights to rugby and movies, so whenever companies start seriously looking at it, they will look upon us as more of a supplier than a competitor.

Sky has confirmed that they have contracts to deliver IPTV via Telecom services, as Sky is planning to release an IPTV service early 2007. “For the foreseeable future, until the infrastructure improves, the satellite is the best way to deliver live rugby but if you wanted to see a game that has been played, the internet is the best way to do that, by streaming,” Mr Fellet said.