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Telstra sells $700m property trust stake

Alex Druce
Telstra has offloaded a $700 million stake in a newly established property trust

Telstra has offloaded its 49 per cent stake in a newly established property trust to a consortium led by Charter Hall for $700 million.

Telstra said the unlisted trust would own 37 of Telstra's existing exchange properties, though the telco will retain a 51 per cent controlling interest in the trust, and operational control of the properties.

Telstra will sign long-term triple-net lease arrangements with the property trust with a weighted average expiry of 21 years, including multiple options for lease extension.

The move is a part of the telco's T22 restructuring program, which also includes 8,000 job cuts and plans to sell $2 billion in assets over three years.

Telstra said the total value of assets monetised as part of T22 restructuring have now risen to about $1 billion.

Charter Hall Long Wale said in a separate statement it would fund the purchase of Telstra's stake in the trust through a combination of debt and equity raising.

Telstra also said on Friday it had reached an agreement to sell part of its portfolio of data centres in Europe and Asia to global private equity firm I-Squared Capital, owners of HGC Global Communications, for $160 million.

This agreement - which was flagged in the company's full-year results on Thursday - is expected to be completed in first half of FY20, pending certain conditions being met.

Shares in Telstra fell by 1.03 per cent to $3.83 by 1103 AEST on Friday.

The company's stock price dropped by 1.8 per cent on Thursday after it announced a 40 per cent decline in full-year profit on NBN headwinds.