Citic Telecom International Holdings Limited, controlled by China?s biggest state-owned investment company, will buy 79 per cent of a Macau phone operator for $1.16bn to expand in Greater China.
Citic Telecom will purchase 51 per cent of Companhia de Telecomunicacoes de Macau, from Cable & Wireless Communications Plc for $749.7m, Hong Kong-based Citic said in a stock exchange filing.
?It will buy a 28 per cent stake from Portugal Telecom SGPS SA for $411.6m, according to the statement. The purchases increase its holding to 99 per cent.
?The business strategy for CITIC Telecom has been to expand its telecommunication businesses in Greater China,? the company said. The acquisition will provide ?an opportunity to take control of Macau?s leading integrated telecom services provider and improve its performance.?
The Macau phone operator, also known as CTM, has the right to provide local and international switched fixed voice and data services in Macau until December 31, 2016, according to the release. As of Nov. 30, its unaudited net asset value was about $215.5m. The government-controlled Macau Post owns the remaining one per cent.
Citic Telecom will fund the purchases with existing cash resources and new bank loans, according to the statement.
For Cable & Wireless, the disposal will allow it to reduce its borrowings and focus on Central America and the Caribbean, it said in an e-mailed release. The deal requires approval from the China and Macau governments, and company shareholders.
Barclays Plc was the lead financial adviser to Citic Telecom, and CITIC Securities Corporate Finance (HK) Limited was also an adviser, according to the statement.
?Following completion of these transactions, we will be a focused pan-America regional operator, with a strong balance sheet, and we intend to pursue new growth opportunities, both organic and inorganic, in this region,? the chief executive officer of Cable & Wireless,? Mr. Tony Rice, said in the statement.
Calls to Portugal Telecom and CTM were not answered outside normal business hours.??
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Source: http://www.punchng.com/business/international-business/citic-telecom-buys-79-macau-phone-operator/
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