(Hong Kong, 5 June 2012) Hutchison Whampoa Limited ("HWL") by virtue of its subsidiary Persall Pte Ltd. and the Li Ka Shing Foundation (the "Foundation") by virtue of its subsidiary Kelburgh Pte Ltd announced today that they have entered into a conditional agreement to acquire 50 per cent and 25 per cent, respectively, of Scailex Corporation Ltd ("Scailex") from Suny Electronics Ltd ("Suny") for a combined consideration of USD125 million. Scailex owns 44.5 per cent of Partner Communications Company Ltd. ("Partner"), a leading telecommunications services provider in Israel.
As part of the transaction, Scailex will sell its Samsung cellular handsets import, distribution and services business to Suny, for USD100 million, providing Scailex with cash of USD100 million to reduce its debt load.
Scailex has existing total debt of approximately USD760 million, of this, USD300 million is owed to the HWL Group and approximately USD460 million to third parties. To enhance Scailex's financial position, upon completion of the transaction, the HWL Group has agreed to extend the repayment date of the USD300 million loan by three years from 2014 to 2017. As a further measure to enhance Scailex's ability to service its debts and mitigate its negative net asset value, Scailex will seek to repurchase approximately 50 per cent of its outstanding non-convertible bonds at a purchase price that is 9 Agorot (9 Shekel Cents) higher than the closing prices of the bonds on the last trading day before the announcement of the transaction (please see table below), after adjusting for the principal repayment prior to completion.
The completion of this transaction is conditional upon, among other things, approval from regulatory authorities, shareholder approvals, the sale of the Samsung business AND the successful repurchase of at least 50 per cent of Scailex's non-convertible bonds.
Upon completion, the HWL Group and the Foundation intend to appoint Amikam Cohen as Chairman of the Board of Partner. The HWL Group and the Foundation believe that the experience of Mr Cohen in the telecommunications industry will contribute significantly to Partner's ability to lead the Israeli telecommunications market.
The HWL Group founded Partner in 1997 and launched its cellular network in 1999. In November 1999, the company's stock was initially offered on the Nasdaq National Market and is today traded both on the Nasdaq National Market and the Tel Aviv Stock Exchange.
In 2009, Scailex acquired a controlling interest in Partner from the HWL Group. Following an approach to the HWL Group on behalf of the controlling shareholder in Scailex, as well as on behalf of Scailex, the HWL Group resolved to return to lead Partner in the new and evolving telecommunications industry in which the company now operates.
The HWL Group, which operates telecom services in 13 markets across the globe, will bring to Partner its experience and capabilities in building successful telecommunications companies that serve as leaders in the telecommunications industry.
The Foundation, which was established in 1980 by international businessman and philanthropist Li Ka-shing, invests in select projects in Hong Kong and around the world in order to maximize the return on capital devoted to charitable causes.
Since 1997, the year in which Partner was founded, the HWL Group has operated in Israel both in the telecommunications industry and in other fields. The company is now in the midst of constructing a desalination facility in Israel, together with its Israeli partner IDE. The facility will be among the largest of its kind in the world, and is expected to provide 150 million cubic meters of water per annum for approximately 25 years, after which it will be transferred to the ownership of the State of Israel.
About Hutchison Whampoa Limited
Hutchison Whampoa Limited (HWL) is a leading international corporation committed to innovation and technology with businesses spanning the globe. Its diverse array of holdings range from some of the world's biggest port operators and retailers to property development and infrastructure to the most technologically-advanced and marketing-savvy telecommunications operators. HWL reports turnover of approximately HKD388 billion (USD50 billion) for the year ended 31 December 2011. With operations in 53 countries and over a quarter million employees worldwide, Hutchison has six core businesses - ports and related services; property and hotels; retail; infrastructure; energy and telecommunications.
For more information, please visit www.hutchison-whampoa.com
About the Li Ka Shing Foundation
The Li Ka Shing Foundation was established in 1980 by global entrepreneur and philanthropist Li Ka-shing. Mr Li considers the Foundation to be his "third son" and has pledged one-third of his assets to it. To date, the Foundation has granted over HKD12.8 billion (USD1.64 billion) in charitable donations, approximately 90 per cent of which has gone to the Greater China region.
The Foundation invests in select projects in Hong Kong and around the world in order to maximize the return on capital devoted to charitable causes.
For more information, please visit: http://www.lksf.org.
For further details, please contact:
Hutchison Whampoa Limited
Mr Hans Leung
Manager - Corporate Communications
Group Corporate Affairs
Tel: (852) 2128 1363
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