HTIL sells Israeli subsidiary for $1.38b

Dylan Bushell-Embling

Hutchison Telecom International (HTIL) has arranged to sell its controlling stake in Israeli operator Partner Communications, as it revealed it had swung to a first half loss.

Israeli mobile importer Scailex has arranged to purchase the Partner stake for around $1.38 billion (HK$10.70 billion), or $17.50 per share.

HTIL owns a 51.3% stake in Partner. The Israeli operations contributed to over 80% of HTIL's 1H revenue.

The sale is expected to close in Q4 - subject to shareholder and regulatory approval - and will net Hutchison a pre-tax gain of around $1 billion, HTIL said.

“We believe this is the right time to monetize the gain from our investment [in Partner] for the benefit of the Company and its shareholders,” HTIL chairman Canning Fok said.

Hutchison will now concentrate its emerging market strategy on its existing operations in Indonesia, Vietnam and Sri Lanka, the company added.

Meanwhile, the company reported a HK$245 million ($31.6 million) net loss for 1H09, compared to a HK$1.16 billion profit a year ago. Turnover declined 19.8% to HK$6.41 billion.

HTIL said its results had been negatively impacted by the depreciation of the new Israeli shekel against the Hong Kong dollar, as well as other side-effects of the economic downturn.

The group increased its total customer base 36.5% year-on-year to 11.6 million. Its Vietnamese operation alone signed up 624,000 new subscribers.

HTIL declined to give guidance for the full year, citing economic uncertainty, but said it was “optimistic” about the second half.

Newly spun-off Hutchison Hong Kong also reported its first-half results. The  company said its profit grew 4% to HK$256 million, wile turnover increased 8% to HK$4.09 billion.

Its mobile customer base grew 7% to 2.7 million, yet ARPU slipped HK$7 to HK$202. Revenue from its fixed-line operations rose 7% to HK$1.62 billion.

Hutchison Australia this week announced that its merger with Vodafone Australia had allowed it to post a $552 million first-half profit.  



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