Consolidation in Hong Kong As HTK Buys Rival Network, CSL
Published on: 20th Dec 2013
By: Ian Mansfield
Australia's Telstra has announced that it is selling its Hong Kong based mobile network subsidiary CSL for USD2.43 billion to its local rival network HK Telecom (HTK).
The sale, which is subject to regulatory approval in Hong Kong and HKT and PCCW Limited security holder approval, would equate to proceeds of approximately A$2 billion for Telstra's 76.4 percent stake. HKT will also acquire the remaining 23.6 per cent shareholding held by New World Development.
Telstra Chief Executive Officer David Thodey said Telstra had enjoyed considerable success in Hong Kong however this was a great opportunity to maximise shareholder value.
"CSL has been a strongly performing business, the compound annual revenue growth rate was 9.4 per cent over the last three years and we have gained market share. We are proud of CSL's achievements. It has established itself as a premium brand and strong player in the market, last year adding 425,000 mobile customers," said Mr Thodey.
"However, there are a number of dynamics in the Hong Kong mobiles market that means this is the right opportunity for Telstra to maximise our return on this successful asset."
The sale of CSL is expected to generate a profit on sale of approximately A$600million.