HKBN’s CEO considers China Mobile’s $7.8 billion offer inadequate and confirms ongoing talks with other potential buyers.
While China Mobile has submitted a $7.8 billion proposal to acquire HKBN, the Hong Kong-based operator’s CEO states that the offer undervalues the company, and negotiations with other bidders are still underway.
Current China Mobile Offer Rejected
William Yeung, CEO and Executive Vice Chairman of HKBN, announced that the $7.8 billion acquisition proposal from China Mobile has not been accepted by the board. He emphasized that the offer does not reflect the true value of the company and HKBN remains open to discussions with other potential buyers.
Strong Financial Performance Key to Rejection
Yeung highlighted that HKBN’s positive financial performance over the past six months—particularly a 5% growth in EBITDA—was a major factor behind rejecting the offer. This growth notably surpasses the 3% increase recorded by the company’s main competitor, Hong Kong Telecom.
Long-Term Investments Overlooked
According to Yeung, the proposed bid fails to account for HKBN’s past capital expenditures exceeding HK$11 billion, as well as the company’s future growth prospects. He forecasted maintaining an EBITDA growth rate of 4% to 5% in the coming years.
Actual Share Value Below Nominal Offer
Yeung pointed out that after deducting dividends, China Mobile’s offer effectively values each share at approximately HK$4.91, which is below the initially stated price of HK$5.23 per share.
Denial of CIC’s Interference in Bidding
Responding to reports alleging that China Investment Corporation (CIC) intervened to block the American firm I Squared Capital’s bid, Yeung dismissed these claims as “rumors” and confirmed ongoing negotiations with both parties. CIC holds a minority stake in HGC Global Communications, controlled by I Squared.
I Squared Remains a Competitor
Yeung confirmed that I Squared has submitted an initial offer for HKBN, though he refrained from disclosing further details. Previous reports suggest that the U.S.-based firm was unwilling to bid above HK$6 per share.
Board Holds Diverse Views
Finally, Yeung clarified that his statements represent his personal views and do not necessarily reflect the official position of the board. He noted that there are still varied opinions within the board regarding the potential sale. HKBN has declined to provide an official comment on the matter.
