China Strategic Holdings yesterday announced that it will pay $100 million to acquire 37 per cent of locally listed telecommunications equipment trader Tricom Holdings, from independent third parties.
The 37 per cent is to be sold by three third parties, including 15 per cent by another Hong Kong listed company, Hong Kong Parkview Group, the rest current and former directors of Tricom.
China Strategic executive director Mico Chung said the acquisition would be made through its wholly owned subsidiary, China Telecom, in a bid to gain access to China's non-network telecommunication business.
The chairman of Tricom, Samuel Sung Ham-wing, holds 42 per cent of the company and is its largest shareholder. Mr Chung said a co-operation agreement had been reached between China Strategic and Mr Sung on joint control and management of the company, with both parties owning an equal stake.
Both parties would have to make an offer to small shareholders but intended to maintain Tricom's listing status on the Hong Kong stock exchange.
Mr Sung would lower his stake to 37 per cent by placing 5 per cent of the shares publicly when China Strategic's acquisition was completed, according to the announcement.
China Telecom's offer of $1.20 per share for Tricom was 55.8 per cent above its closing price of $0.77 last Friday. Tricom's shares were suspended from trade for two days.