The Australian government will sell its stake in Telstra, beginning with a third of its shares going on sale in October and November, Prime Minister John Howard, quoted by an Associated Press report, said.
The report quoted the prime minister as saying that A$8 billion ($6 billion) worth of shares would be put on the market, about a third of the government's 51.8% holding in Australia's largest telco.
"The government intends to offer in the order of A$8 billion of stock to retail and institutional investors, in Australia and overseas," he said in a statement, adding that the shares would be transferred to Australia's Future Fund.
The sale of the government's entire majority shareholding, valued at A$22.5 billion ($17 billion), would have been the largest privatization in Australia's history, the report said.
Telstra's share price had fallen to less than half of what it was since the last government offer of Telstra shares was sold in 1999.
Telstra welcomed the decision, the report said.
Legislation to sell the government's 6.44 billion shares in the former telecom monopoly passed the Senate by a narrow margin last September.
The Australian Cabinet was originally scheduled to give the sale a final go-ahead in the first quarter of this year, but the decision was repeatedly postponed as Telstra's share price plummeted amid the company's management's repeated clashes with the government and the regulator, the report further said.