Bloomberg News

Citic Pacific Unit Is in Talks to Buy Macau Operator Stake

October 17, 2012

Citic Pacific Says Unit Citic Telecom in Talks to Buy CTM Stake

Processing facilities are built into the mine face at Citic Pacific Ltd.'s Sino Iron project under construction in Karratha, Western Australia. Photographer: Carla Gottgens/Bloomberg

Citic Pacific Ltd. (267), controlled by China’s biggest state-owned investment company, said a unit is in talks to buy Cable & Wireless Communications Plc (CWC)’s stake in a Macau service operator to increase its shareholding.

Citic Telecom International Holdings Ltd. (1883) plans to buy Cable & Wireless’s 51 percent stake in Companhia de Telecomunicacoes de Macau, S.A.R.L. to boost its holding to 71 percent, Citic Pacific said today in a statement. Cable & Wireless confirmed the talks in a separate statement. The companies didn’t provide financial details of the planned deal.

The purchase would be Citic Pacific’s first since 2009, when it bought a 10 percent stake in a Shanghai real estate management company, according to data compiled by Bloomberg. Acquisitions of telecommunication companies have slowed worldwide, with $83.9 billion of completed purchases so far this year, compared with $180.3 billion in the same period of 2011, the data show.

Citic Telecom climbed 6.1 percent to close at HK$1.73 in Hong Kong trading, the highest level since March 16. Citic Pacific closed 1 percent higher at HK$9.72. Cable & Wireless advanced 3.7 percent to 37.54 pence as of 9:30 a.m. in London, poised for the largest gain in a month.

Citic Telecom expects to fund the proposed acquisition with internal resources, bank loans or debt, or equity financing, according to the Citic statement.

Citic Pacific is a steelmaker and property developer that is building an $8 billion iron ore mine in Western Australia. The Hong Kong-based company is considering selling part of its controlling stake in Citic Telecom to its parent in order to focus on its core business, it said.

Cable & Wireless Communications, based in London, was split from Cable & Wireless Worldwide in 2010.

To contact the reporter on this story: Michelle Yun in Hong Kong at myun11@bloomberg.net

To contact the editor responsible for this story: Michael Tighe at mtighe4@bloomberg.net


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