Hutchi­son Tele­com jump on news of HGC sale

New Straits Times - - Business / World -

HONG KONG: Hutchi­son Telecom­mu­ni­ca­tions Hong Kong Hold­ings Ltd shares jumped al­most 15 per cent when it started trad­ing yes­ter­day, a day af­ter it an­nounced the sale of its fixed-line busi­ness for about US$1.9 bil­lion (RM8.11 bil­lion).

Hutchi­son Tele­com, a unit of Hong Kong’s rich­est man Li KaShing’s CK Hutchi­son Hold­ings, said it had agreed to sell its fixed­line tele­coms busi­ness to I Squared Cap­i­tal for HK$14.5 bil­lion (RM7.95 bil­lion) in cash.

Pro­ceeds from the sale of Hutchi­son Global Com­mu­ni­ca­tions (HGC), which pro­vides fixed-line phone ser­vices as well as WiFi all around the coun­try, will be used for in­vest­ment into mo­bile phone ser­vices and for work­ing cap­i­tal.

The price rep­re­sented about 12 times HGC’s earn­ings be­fore in­ter­est, taxes, de­pre­ci­a­tion and amor­ti­sa­tion, said a source close to the deal.

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