Telstra sells controlling stake in CSL for $2.4B

Telstra to sell controlling stake in CSL for $2.4B

20 DEC 2013

Telstra is to sell its 76 per cent stake in Hong Kong’s CSL for US$2.4 billion, so disposing of its sole mobile network investment outside its domestic market.

The Australian operator is offloading the stake to Richard Li’s HKT, a Hong Kong rival, which is also picking up the remaining 24 per cent held in CSL by New World Development.

CSL is Hong Kong’s largest operator while HKT lags back in fifth place.

The deal still requires regulatory approval in Hong Kong as well as the support of shareholders in PCCW, HKT’s parent.

Despite a sale that represents a retreat from overseas mobile network investments, Telstra CEO David Thodey (pictured) said Asia remained an important part of Telstra’s strategy and it intended to stay in the region for the long haul.

He also talked up the attraction of CSL as an asset: “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.”

But he added that it was a smart move to cash in the stake right now: “There are a number of dynamics in the Hong Kong mobile market that means this is the right opportunity for Telstra to maximise our return on this successful asset.” The Australian operator said it would generate a profit of approximately $530 million..

Telstra does retain non-network international assets, such as internet search and advertising businesses in China, as well as submarine cable investments and data centres in Singapore.

 

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Richard Handford

Richard is the editor of Mobile World Live’s money channel and a contributor to the daily news service. He is an experienced technology and business journalist who previously worked as a freelancer for many publications over the last decade including...

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