Richard Li: I feel bad upsetting S'pore feelings
business-times.asia1.com.sg
CyberWorks chief says HKT takeover deal is not an anti-Singapore move
By Catherine Ong
[SINGAPORE]
Richard Li, whose 10-month-old Internet company this week snatched a US$38 billion (S$65.4 billion) corporate prize from Singapore's biggest company, said he feels "pretty bad" that he has upset local feelings.
"I hope this is not seen as an anti-Singapore move," the 33-year-old founder of Pacific Century CyberWorks told The Business Times in a phone interview during a one-day visit to Singapore yesterday.
Sounding almost apologetic, he added: "It's a commercial opportunity that's kind of difficult to miss."
In a dazzling corporate coup, CyberWorks took just two weeks to muscle out Singapore Telecom for control of Cable & Wireless (HKT), proving that it is in the same league with the likes of AOL in turning highly-inflated paper into real currency.
In particular, it stunned the corporate world in Asia when it took minutes to raise US$1 billion in a share placement, and days rather than weeks to convince a consortium of commercial banks which were still smarting from loan losses in the Asian financial crisis, to lend it a cool US$11 billion.
His victory has made him feel "very uncomfortable" as he is concerned about not burning bridges here. "I've always liked Singapore, I have a public company here before I have one in Hongkong," Mr Li said, stressing that when the merger is completed, HKT will be majority owned by a Singapore entity, Pacific Century Regional Development, the parent of CyberWorks.
Extending an olive branch, he said that "if there's any opportunity to work with Singapore Inc, we would want to . . . and we will keep an open mind about doing business with SingTel or any other Singapore company". Mr Li revealed that during negotiations for HKT, he had explored a joint bid with SingTel but it didn't take off, because among other reasons, "the time-table was too tight for an agreement to be drawn up.
"I think the SingTel people were professional and responsible, I don't think they wanted to overpay, we didn't want to overpay too, we put in only one bid and didn't change it." Mr Li dismissed media speculation that he was put up to the fight with SingTel by China. "It's bulls . . ., it's total bulls . . .," he said.
He pointed out that "just because Bank of China is one of our advisers" did not mean that the deal was politically-inspired. BOC, he said, has an investment banking arm and one of its senior managers had been involved in previous deals with him. "This guy used to be from the Agriculture Bank and he is very bright, he did the IPO for China Telecom," Mr Li said.
And even before Warburg Dillon Read, the investment banking arm of UBS, pitched the idea of going for HKT, CyberWorks has been targeting acquisition of another company, he revealed.
Mr Li didn't explain why he feels he may have caused unhappiness here with his victory. But observers said that going by reports in The Straits Times -- which Mr Li's advisers take as a proxy for SingTel's views -- and an angry statement by the phone company alleging unprofessional conduct on the part of HSBC, whose participation in the loan was critical to Mr Li's bid, the general perception, rightly or wrong, was that Singapore Inc was chafed.
Reflecting such a perception, the British Broadcasting Corporation yesterday ran a report asking: "Is corporate Singapore right to be so exercised about losing the C&W HKT deal?"
"Corporate Singapore is not upset, SingTel is," a director of a local broking firm told BT.
Peter Seah, president of Overseas Union Bank, dismissed any fear that the sometimes jingoistic sentiments that have surfaced in both Singapore and Hongkong during the takeover battle would affect other local firms doing mega deals in the territory.
"What has it got to do with us, it's just a business deal," he said.
Ng Jui Ping, the retired army chief who is executive chairman of Horizon.com, a business partner of Pacific Century, also discounted any collateral damage from the bruising takeover battle.
"I don't think Hongkong people are going to say 'I'm not going to do any deals with Singaporeans just because SingTel tried to take over HKT. Likewise Singapore businessmen, who are also pragmatic'."
On the impression that the Singapore establishment has never quite embraced Mr Li, the retired lieutenant-general said: "I don't think Richard Li is treated any differently by the Singapore establishment than any other Hongkong businessman or Singapore businessman for that matter.
"In general, officials in Singapore take the idea of keeping an arm's length relationship with business more stringently than their counterparts in many other countries including Hongkong."
So far, there is no sign that the Singapore government has treated the HKT bid as anything other than a commercial deal. Prime Minister Goh Chok Tong said recently that SingTel's decision to withdraw from the merger talks was "basically a commercial decision by SingTel, and SingTel will know best what it needs".
And if attendance at a party thrown by Pacific Century on Thursday in conjunction with the three-day Internet World show is anything to go by, Mr Li is becoming a hot item in this town too.
The spacious Shrooms restaurant at Chijmes was packed to the brim with a motley crowd, some in elegant evening clothes and others in T-shirts and jeans. Lawyers, journalists, bankers, aspiring Internet millionaires and MTV celebrities were still streaming into the party at midnight hoping to get a glimpse of Mr Li who, however, failed to make it to the party.
The stockbroking director said he only realised the pull of Mr Li when he made a presentation recently to a local Internet firm planning to go public. "At the end of my presentation, they told me, 'We like your story but can you put us in touch with Richard Li?'
"They reckoned that if Richard Li's name is on it, their stock will fly. It took me 10 seconds to realise that they're right, Richard Li has made himself into a brand name which in the Internet community is far more important than our mandarins realise."
Meanwhile, SingTel yesterday issued a statement saying that it is still subject to the Hong Kong Code on Takeovers and Mergers as it is keeping its position to withdraw from the merger talks under review "and may reconsider its position in the light of the progress" of CyberWorks' proposed offer.
It advises investors to exercise caution in dealing in its shares and those of HKT. |
