HKT Board Sends Merger Deal to Shareholders

HONG KONG (03/29/2000) - The board of Hong Kong carrier Cable & Wireless HKT Ltd. yesterday gave its blessing to Pacific Century CyberWorks Ltd.'s (PCCW) merger bid and agreed to pass the terms on to its shareholders for approval.

The Hong Kong-based Internet investment company last month proposed to buy all the shares of C&W HKT, offering an all-share option and a cash-and-stock option. At today's PCCW share price, the offers would be worth approximately US$29.6 billion and US$32.3 billion, respectively. Its local bid won out in a bidding war against Singapore Telecommunications Ltd. [See "UPDATE: CyberWorks Details C&W HKT Merger Offer," March 1.]C&W HKT's board said in a statement that it was "satisfied with the progress of discussions" with PCCW and would present the merger proposal to shareholders by May 18. It also formed an board of independent directors to review the terms.

The board of C&W HKT's majority shareholder, U.K.-based Cable & Wireless (C&W) PLC, approved the deal late last month.

Market watchers last week said there was concern the offer might be rejected if PCCW's share price fell below a level agreed by C&W PLC, which was rumored to be HK$18.60. (See "PCCW Stock Decline Might Threaten HKT Deal," March 22.) PCCW was trading yesterday at HK$19.

PCCW plans to use C&W HKT's broadband infrastructure as an early platform for its Network of the World multimedia data service, designed to eventually serve all of Asia through a network of satellites and cable-TV systems.

C&W HKT, in Hong Kong, can be reached via the Web at http://www.hkt.com/. PCCW, also in Hong Kong, is at http://www.pcg-group.com/.

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