MELBOURNE (Standard & Poor's) May 5, 2006--Standard & Poor's Ratings Services today said the New Zealand government's intention to further develop the country's telecommunications regulations and change access arrangements to Telecom Corp. of New Zealand Ltd.'s (TCNZ; A/Stable/A-1) network has no immediate effect on the company's rating or stable outlook. Although the timing and financial consequences of the proposed changes for the company remain unclear, the regulatory development is likely to weaken TCNZ and its market position. At the same time, Standard & Poor's said that TCNZ's third-quarter results, released earlier today, reflect the company's strong cash flow-generating position, despite some softening in margins and operating cost pressure because of a deterioration in its Australian activities and the continued migration
