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Technology Stocks : PCW - Pacific Century CyberWorks Limited -- Ignore unavailable to you. Want to Upgrade?

To: ms.smartest.person who wrote (435)	2/25/2001 7:40:14 AM
From: ms.smartest.person	Read Replies (1) \| Respond to of 2248

PCCW buys Hutchison unit By Joe Leahy and Rahul Jacob in Hong Kong Published: February 22 2001 19:50GMT \| Last Updated: February 23 2001 12:38GMT Pacific Century CyberWorks (PCCW), the Hong Kong internet and telecommunications company founded by Richard Li, is to pay HK$803m ($102.9m) for a satellite data services operator owned by Hutchison Whampoa, the Hong Kong conglomerate controlled by Mr Li's father. PCCW said on Thursday it would pay for the company, Hutchison Telecommunications Technology Investments, with its Hutchison Corporate Access unit, by issuing new shares valued at HK$4.375 per share, Thursday's closing price. The deal would leave Hutchison, controlled by Li Ka-shing, who is Hong Kong's richest tycoon, with a 0.83 per cent stake in the son's company. However, the acquisition, which comes just one day after the expiry of a six-month lock-up period on the sale of a 7.5 per cent stake in PCCW held by Cable & Wireless of the UK, was unlikely to bring much cheer to PCCW investors. They remain concerned about the overhang posed by the stake, which Cable & Wireless has repeatedly said it wants to sell. Such fears have already helped to knock more than two-thirds off PCCW's share price over the past six months. "At the end of the day it would seem not to add much to [PCCW's] core operations," said Richard Ferguson, analyst with Nomura International. PCCW said the acquisition would enable it to expand the reach of its corporate data business beyond Hong Kong to remote or less developed areas in the region. For Hutchison, the disposal is in line with its strategy of pursuing fixed-line and mobile telecoms services. "This is an arm's-length transaction, with Hutchison disposing of its satellite assets and PCCW accelerating its regional reach," said Linus Cheung, deputy chairman of PCCW. Hutchison Corporate Access was founded by Richard Li's Pacific Century Group in 1994 and sold to Hutchison a year later for US$74.5m. Mr Li originally sold the company to avoid a conflict of interest, Mr Cheung said. At the time Mr Li was also on the board of Hutchison, whose strategy also included satellite data communications. Now, with Hutchison divesting its satellite data businesses and PCCW moving back to the area, it made sense to buy it back, he said. PCCW shares moved 4 per cent higher on Friday to HK$4.55, while Hutchison slipped 1.9 per cent to HK$90.75. news.ft.com