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UPDATE 2-Hutchison's fixed-line biz draws interest from PEs, Hong Kong's HKBN - sources
2017年6月8日 / 凌晨5点08分 / 5 个月前

UPDATE 2-Hutchison's fixed-line biz draws interest from PEs, Hong Kong's HKBN - sources

* Hutchison fixed-line business unit of billionaire Li Ka-Shing

* Deal could be valued at $1.5 bln to $1.9 bln

* TPG-MBK combination won Wharf’s fixed-line phone biz last year

* First round bids for HGC due by end of June (Adds deal details, background on Li Ka-Shing business, share price)

By Carol Zhong and Prakash Chakravarti

HONG KONG, June 8 (Reuters) - A consortium of private equity firms TPG Capital Management and MBK Partners, as well as telecoms firm HKBN Ltd, are preparing separate bids for the fixed-line phone unit of Hong Kong’s richest man, Li Ka-Shing, sources with direct knowledge of the matter said.

Hutchison Global Communications (HGC), a unit of Hutchison Telecommunications Hong Kong Holdings Ltd, provides a range of fixed-line telecommunications services in Hong Kong and overseas for corporate and residential users.

The HGC business is expected to be valued at about $1.5 billion, five sources said, requesting anonymity because the details had not been released publicly.

Two of the sources, however, said the deal could be valued at as much as 12 times the company’s earnings before interest, tax, depreciation and amortisation (EBITDA) of $161 million in 2016, pushing the acquisition cost to as much as $1.9 billion.

The first round bids for the asset are due by end of this month, the sources said.

Representatives for HGC, Hong Kong broadband and telecoms service provider HKBN, TPG and MBK declined to comment.

In October last year, the TPG-MBK consortium agreed to buy Hong Kong tycoon Peter Woo’s Wharf Holdings Ltd’s telecoms business for HK$9.5 billion ($1.22 billion).

It was not immediately clear whether the consortium would look to merge the fixed-line business of Wharf with HGC should they win the auction.

TPG and MBK are in talks with banks to raise funds for the acquisition, the sources said.

MBK Partners has a long track record of investing in Asian technology, media and telecommunications assets, including Taiwanese network TV operator China Network Systems, cable television network Gala TV and Japanese software maker Yayoi.

TPG has also invested in a wide range of telecom companies in Asia, including telecommunications service provider Asia Netcom (now known as Pacnet) and Japan Telecom (now known as SoftBank Telecom).

HGC offers “wholesale services” to support mobile operators, global carriers, multinational firms, internet content providers and application service providers in Hong Kong, the Americas, Europe, the Middle East and Africa, along with the rest of Asia.

It owns and runs an extensive optical-fibre network, coupled with four cross-border routes integrated with three of mainland China’s tier-one telecoms operators and an international network, according to its website.

HGC’s parent Hutchison Telecommunications is a part of billionaire businessman Li’s CK Hutchison Holdings conglomerate, whose business interest range from property, infrastructure and retail to finance and energy.

On Thursday, shares in Hutchison Telecommunications were trading 2.1 percent higher at HK$2.45 and CK Hutchison was up 0.4 percent at HK$101.4, while the broader Hong Kong market rose 0.2 percent in afternoon trade.

$1 = 7.7940 Hong Kong dollars Reporting by Carol Zhong, Prakash Chakravarti and Chien Mi Wong of LPC; Additional reporting by Elzio Barreto and Donny Kwok; Writing by Sumeet Chatterjee; Editing by Stephen Coates

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