Australia’s corporate watchdog will investigate Friday’s sudden surge in Telstra’s share price, two days before the firm announced an A$11 billion ($9.6b) deal with the state-backed NBN Co.
Telstra’s shares gained 2.2% on Friday, closing the day at their highest price for the month, with more than A$198 million in shares being traded, said the Sydney Morning Herald and Ten News.
The Australian Securities and Investments Commission (ASIC) will investigate the sudden share price spike after the matter was raised by Opposition treasury spokesman Joe Hockey.
Corporate Law Minister Chris Bowen, who referred the matter to ASIC, told the SMH he was “very concerned” about the allegations of illegal share trading.
He said the government took the matter “very seriously.”
Telstra's share price closed eight cents lower yesterday at A$3.26, having surged more than 3% on Monday in the wake of Telstra’s A$11 billion agreement with NBN Co.
On Sunday, Telstra said it had signed a non-binding heads of agreement with NBN Co to merge its fixed-line infrastructure and customers to NBN Co.