Citic 1616 buys CTM stake for $180m

Robert Clark
15 Feb 2010
00:00

Hong Kong-based Citic 1616 is to buy a 20% stake in Macau incumbent CTM from its parent Citic Pacific.

The company, which provides IDD and enterprise services in Hong Kong and mainland China, will pay HK$1.4 billion ($180m) for the stake, it announced Thursday.

The price of HK$2.3 per share is a premium of approximately 1.8% over last trading price. Citic 1616 will pay HK$467 million in cash and HK$933.4 million in new shares.

As part of the deal, Citic Pacific – a Chinese government-owned “red chip” investment firm – will increase its shareholding in CITIC 1616 from 52.57% to 60.65%.

As well as Citic Pacific, CTM is owned by Cable & Wireless, Portugal Telecom and the state-owned Macao Post. It has exclusive rights to offer fixed voice in Macau until the end of 2011, and also holds 2G, 3G licenses and ISP licenses.

Citic 1616 said the deal would increase roaming traffic passing through its Macau hubs and boost its wholesale IDD business.

Chairman Xin Yuejiang said it offered synergies in network sharing and innovation in new services.

Citic 1616 last week announced a 12% higher net profit of HK$372 million for 2009 on sales of HK$2.7 billion.

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