Former Citigroup banker Francis Leung Pak-to (pictured) is finding it tough to arrange financing for his planned HK$9.1 billion acquisition of most of PCCW chairman Richard Li Tzar-kai's stake in the company, market sources said. Potential investors wanted to see the make-up of the investor consortium he had promised to assemble before making any loan commitments, the sources said. 'We've been told [by our head office in Beijing] to wait and see' what kind of investors he lines up, a Hong Kong-based banker at a mainland lender said. Big institutions, such as China Construction Bank and Bank of China, are seen as the most likely lenders to the deal given their close ties to the Chinese government. Beijing fiercely opposed Mr Li's efforts to sell PCCW's media and telecommunications assets which could have led to control over Hong Kong's dominant fixed-line phone carrier falling into foreign hands. Mr Leung's last-minute intervention was widely seen as a move to thwart such a sale. Mr Leung, an investment banker with no experience in the telecommunications business, has pledged to assemble a group of investors by November. Through a specially created holding company called Fiorlatte, he agreed on July 10 to pay HK$6 a share for a 22.66 per cent stake in PCCW owned by a Richard Li-controlled, Singapore-based firm. Shares of PCCW, which closed at HK$4.80 yesterday, have not traded as high as HK$6 since April 2004. That is one reason the hedge funds, private equity firms and Hong Kong tycoons Mr Leung has approached for funding have not responded very favourably, according to market sources. 'The deal he has struck solves the political problem but doesn't address the economic issue,' one market observer said. Beijing's reluctance to let PCCW fall into the hands of foreign companies makes the deal less attractive because it limits any potential future buyers for the stake; investors will want to cash out - at a profit - in a few years' time. 'There's no exit,' one source said. In June, US buyout firm TPG-Newbridge and Australia's Macquarie Group each offered up to HK$60 billion for PCCW's telecommunications and media assets, including its fixed-line network, NOW Broadband TV and internet and mobile phone operator Sunday Communications. PCCW's board rejected the offers late last month after Mr Leung stepped in. Mr Leung, while expressing confidence that he would raise the needed funds 'in due course', acknowledged in an e-mail that 'I know it is not going to be easy,' adding that 'if it were easy, my involvement would not be required and many people could do it'. Mr Leung is estimated to have a personal fortune of about US$250 million, market sources said, with about US$100 million of that in liquid assets. Mr Li indirectly owns 22.66 per cent of PCCW through his 75 per cent stake in the company's Singapore-listed subsidiary, Pacific Century Regional Developments. PCRD said in a statement last month that Mr Leung would pay the company HK$9.1 billion in stages over an 18-month period and pay 6.5 per cent in interest.