(Hong Kong, 8 January 2010) Hutchison Whampoa Limited ("HWL") and Hutchison Telecommunications International Limited ("HTIL") jointly announce today that an HWL Group company ("Offeror") has requested the board of directors of HTIL to put forward a proposal to privatise HTIL by way of a Scheme of Arrangement (the "Scheme") under the Companies Law of the Cayman Islands ("Proposal").
The Proposal will provide that each share of HTIL held by HTIL shareholders (other than those which are wholly owned by HWL) on a record date to be announced will be cancelled in exchange for HK$2.20 in cash. This amount represents a 37% premium over the closing price on the day prior to the suspension of trading in the HTIL shares. Holders of HTIL American Depositary Shares ("ADSs") will for each HTIL ADS receive the US dollar equivalent of HK$33.00 in cash before fees and taxes. The Offeror has stated that the HK$2.20 amount will not be increased.
HTIL was listed in October 2004 and has since established itself as a leading pan-Asian emerging markets telecom operator. Since its IPO, HTIL has generated total returns (including dividends and the value of the Hong Kong and Macau spin-off) of 178% to the HTIL shareholders, translating to an annualised return of 22% per annum through 31 December 2009.
HWL notes that, following the sale by HTIL's subsidiaries of their respective interests in the India and Israel operations, and the spin-off of its Hong Kong and Macau businesses. HTIL now has operations in four countries, none of which is amongst the top three operators in their respective markets and all of which generate negative cash flow. HWL believes that HTIL will continue to need significant capital to broaden and expand its businesses and accordingly, anticipates that all the current cash in the HTIL Group will be retained to fund its businesses, particularly in Indonesia and Vietnam resulting in no surplus cash being available for dividends.
While HWL remains confident in the future prospects for HTIL's growth businesses, HWL is of the view that in the short and medium terms HTIL faces potential uncertain financial performance with the associated risk of significant share price volatility, thus making it less suited to remain a publicly listed entity. HWL further notes that HTIL's market capitalisation has fallen from its high of HK$95.6 billion in January 2007 to its current level of HK$7.9 billion and concurrently, liquidity and trading in both HTIL's shares and its ADSs have greatly declined.
After the proposed privatisation, HWL believes that HTIL would be more able to make decisions pertaining to investments without the pressures associated with being a publicly listed company. This will bring benefit to HTIL's business and to HWL's shareholders in the long term.
It is anticipated that on completion of the privatisation, the listing of the HTIL shares on the Stock Exchange of Hong Kong ("SEHK") and the listing of the HTIL ADSs on the New York Stock Exchange ("NYSE") will be withdrawn.
A Scheme document of HTIL containing further details of the Proposal and the Scheme, including the conditions to be satisfied and the expected timetable, will be despatched to HTIL shareholders and to HTIL ADS holders as soon as practicable and in compliance with applicable regulatory requirements.
Application has been made to the SEHK for the resumption of trading in the HTIL shares on 8 January 2010 (Hong Kong Time) and trading in the HTIL ADSs is expected to resume on 8 January 2010 (New York Time).
For detailed information, please refer to the 8 January 2010 joint announcement by HWL, the Offeror and HTIL which is available on HWL's website (www.hutchison-whampoa.com), HTIL's website (www.htil.com), the website of SEHK, and in due course will be available on the website of the United States Securities and Exchange Commission.
For media enquiries, please contact:
|Hans Leung||Ada Yeung|
|Hutchison Whampoa||Hutchison Telecom International|
|Tel: (852) 2128 1363||Tel: (852) 2128 3106|
|Fax: (852) 2128 1766||Fax: (852) 2187 2087|
|Email: email@example.com||Email: firstname.lastname@example.org|
This press release contains forward-looking statements. Statements that are not historical facts, including statements about the beliefs and expectations of HWL and HTIL, are forward-looking statements. These statements are based on current plans, estimates and projections, and therefore you should not place undue reliance on them. Forward-looking statements speak only as of the date they are made, and each of HWL and HTIL undertakes no obligation to update publicly any of them in light of new information or future events. Forward-looking statements involve inherent risks, uncertainties and assumptions. Each of HWL and HTIL cautions you that if these risks or uncertainties ever materialise or the assumptions prove incorrect, or if a number of important factors occur or do not occur, each of HWL and HTIL's actual results may differ materially from those expressed or implied in any forward-looking statement. Additional information as to factors that may cause actual results to differ materially from each of HWL and HTIL's forward-looking statements can be found in each of HWL and HTIL's filings with the United States Securities and Exchange Commission.
This press release appears for information purposes only and does not constitute an invitation or offer to acquire, purchase or subscribe for securities of the Offeror, HWL or HTIL nor is it a solicitation of any vote or approval in any jurisdiction. This press release also does not constitute any solicitation or recommendation under rules and regulations of the US Securities and Exchange Commission.
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