Richard Li, chairman of PCCW in Hong Kong, wants to close a deal soon to sell the company’s media and telecommunications assets. Earlier this week, Li told journalists that he hoped to conclude the sale before the end of July.
Li’s comments came after a PCCW board meeting held on July 3. It was the first board meeting since the company received unsolicited bids for the assets. A consortium led by Australia’s Macquarie Bank and US private equity firm TPG-Newbridge have made bids for the assets, valuing them at approximately $7 billion.
Li, who is the son of Asia’s richest man Li Ka-shing, said in a televised interview that discussions with the company’s board have been “harmonious”. He also indicated that while no decision has been made on the sale, talks will continue this week.
“All I can say is everyone is focused on discussing the matter and we hope to achieve the best result for all our shareholders,” Li said.
One potential obstacle to a sale is PCCW’s second largest shareholder, China Netcom, which holds a 20 percent stake in the business, and which has expressed resistance to changes in its ownership. China Netcom has three board seats, and all three directors attended the board meeting this week.
According to Wen Wei Po, a Hong Kong Chinese newspaper, China Netcom has been planning to make its own offer for the assets to prevent Hong Kong’s fixed-line telephone network from falling into foreign hands. The report has since been described by a China Netcom spokesman as “erroneous”.
According to a Dow Jones Newswires report, both Macquarie and TPG-Newbridge intend to bring China Netcom into the deal as a partner in the event of a successful acquisition.
Macquarie has reportedly offered $7.3 billion for PCCW’s assets. Details of TPG-Newbridge’s offers are unknown, although the firm is thought to have offered slightly more.
PCCW declined to comment on the offers on the table.