On Wednesday, New Zealand Telecom declared that it will split the operations of fixed-line network from its other businesses, in order to be a part of the Government's ultra fast broadband plan.

Telecom has been put into a stressful condition by Standard & Poor's, as the latter has positioned the former on Creditwatch and has warned it to cut its rating by two points, if it splits its operations. S&P, in May, degraded the long-term projection of Telecom from stable to negative. The Company was given the ratings as A for long-term and A-1 for short-term

Telecom took the assistance of Crown Fibre Holdings to divide its businesses and moving ahead with this, it presented a proposal to Crown on Monday to separate its business of fixed line assess network from other entities, as told by Paul Draffin, a Credit Analyst of Standard & Poor's. He further added that this declaration by the Company reflects that it is likely to follow the suit.

But, Telecom Chief Financial Officer Russ Houlden is optimistic to maintain its rating at A.

He said, "We believe that Telecom's proposal to Crown Fibre Holdings aligns the interests and incentives of Telecom, its shareholders, the Government and New Zealanders".

No more details over the restructuring of the business of Telecom have been revealed, yet.

The ultimate ratings will be based on the assets that the Telecom will be retaining, the distribution of debt between the different entities and its forecasts for the business.