Telstra Corporation Ltd (ASX:TLS) shares up on HarbourVest merger

Shares in embattled telco Telstra Corporation Ltd (ASX: TLS) are up 1.7% to $2.67 today after The Financial Review yesterday reported Telstra committed another US$125 million in the merger of its venture business with private equity player HarbourVest Partners.

The injection will create a new fund valued at $675 million with HarbourVest paying around US$62.5 million for a 25% stake in the existing business, according to the article.

Telstra shares have been trending down for a long time, but truly hit the skids in the last fortnight – dropping to a multi-year low of $2.61 after investor confidence dropped on the announcement of its 2022 strategy.

All eyes are on full-service telco TPG Telecom Ltd (ASX: TPM) whose emergence in the space has placed pressure on Telstra to ramp up its investment in technology and keep pace with competitors – something the HarbourVest deal should help them to do.

Peer Vocus Group Ltd’s (ASX: VOC) share price is up 1.7% to $2.34 today off the back of news the company has increased its debt facility to provide “financial headroom and flexibility” to pursue strategic direction.

A lot of Telstra shareholders have stuck it out with the stock for its dividend history.

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Motley Fool contributor Carin Pickworth owns shares of Telstra Limited. The Motley Fool Australia owns shares of and has recommended Telstra Limited, TPG Telecom Limited, and Vocus Communications Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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