City Telecom to exit telecom business

News Broadband Hong Kong 11 APR 2012
City Telecom to exit telecom business
Hong Kong communications firm City Telecom is exiting the telecommunications business in Hong Kong and Canada to focus solely on its IPTV and multimedia business currently offered under its Hong Kong Broadband Network (HKBN) brand. City Telecom plans to sell its telecom business to private equity firm Metropolitan Light Company for HKD 4.95 billion on a cash-free, debt-free basis. Completion of the transaction is subject to shareholder approval. Part of the proceeds of the sale will be returned to shareholders, and the rest will be invested in the multimedia business. City Telecom has begun a large scale project to build a multimedia centre of at least 400,000 square feet. The project is expected to cost over HKD 800 million and is expected to be fully operational in April 2014. City Telecom's multimedia business is a long-term project which is expected to cost over HKD 2.50 billion over the next four years.

Categories:

Fixed

Companies:

City Telecom,  Hong Kong Broadband Network,  HKBN

Countries:

Canada,  Hong Kong

Tags:

Wireline, Internet Access, M&A buyouts & divestments

Related Articles

CANADA 31 MAY 2012

City Telecom completes exit from telecom business

Hong Kong communications firm City Telecom has completed its exit from the telecommunications business in Hong Kong and Canada to focus solely on its IPTV and multimedia business. City Telecom sold its telecom business to private equity firm Metropolitan Light Company for a consideration of HKD 4.87 billion. With the proceeds, City Telecom will pay a special dividend of HKD 2.50 per share and the rest will be invested in the multimedia business.

GLOBAL 23 APR 2012

Divestments become urgent, rather than strategic

Recent reports of a strategic rethink in KPN's portfolio can apply to the whole European telecom sector. Mergers and acquisitions are relevant to the core activities, to win market share, develop new markets and enter emerging markets. However, considered alongside the growing need to invest in the roll-out of new networks, the latest moves by operators may appear somewhat negative. At the moment, divestments seem to be driven more by financial pressures than solid strategic choices.

HONG KONG 23 APR 2012

City Telecom's H1 revenues grow 11%

Hong Kong communications firm City Telecom saw its profit fall in the six months ended 29 February on multimedia business start-up costs. Revenues went up 11 percent to HKD 918.3 million from HKD 826 million, mainly due to strong fixed telecommunications business, which generated HKD 828 million, up 14 percent year-on-year. However, turnover for international communications services was HKD 90.3 million, down 6 percent year-on-year. Fixed-line subscriptions in total rose by 60,000 to 1.31 million. The numbe

HONG KONG 9 NOV 2011

City Telecom grows FY profit by 44.7%

Hong Kong communications firm City Telecom grew its net profit almost 45 percent for the full year ended 31 August 2011. Net profit rose 44.7 percent to HKD 313.9 million due to finance cost savings in the year. EBITDA totalled HKD 594.1 million, up 26.6 percent, and total turnover grew by 6.8 percent to HKD 1.68 billion. The Fixed Telecommunications Network Services business saw turnover go up by 9.5 percent to HKD 1.48 billion, which more than offset the drop in IDD of 9.8 percent to HKD 197.2 million. Tr

HONG KONG 17 AUG 2011

City Telecom to build multimedia centre

Hong Kong communications firm City Telecom has unveiled a plan to establish a multimedia centre. The centre, which will features studios, an information hub, a post-production suite, and a creative imaging centre, will cost around HKD 600 million to build and is expected to be ready for operations in 36 months.

HONG KONG 3 JUN 2011

HKBN launches 1Gbps triple-play offer for USD 20 per month

Hong Kong Broadband Network (HKBN), a wholly-owned subsidiary of City Telecom, has launched a triple-play offer. The offer includes 1 Gbps broadband, voice, and pay-TV services for USD 20 per month (HKD 158) on a 24-month contract. The company says it is benefitting from rapidly increasing economies of scale as take-up of its 1 Gbps service increases. Cost per home passed is around USD 200, HKBN said, which allows the company to increase its return on equity from 3.2 percent in FY 2007 to 19 percent in the

HONG KONG 23 MAY 2011

HKBN signs up 10,000 1 Gbps subscribers

Hong Kong Broadband Network (HKBN), wholly-owned subsidiary of City Telecom, has grown the subscriber base of its symmetric 1 Gbps broadband service to 10,000. HKBN offers the service for HKD 199 per month.

HONG KONG 24 FEB 2011

City Telecom (Hong Kong) sets the good example for FTTH operators

City Telecom has grown its business into the number two player on the Hong Kong fixed market, behind incumbent PCCW. In 2010 the operator took 93 percent of net additions on the market. This takes the company closer to its goal announced in 2006, to be the market leader within ten years. City Telecom's strategy is centred on the roll-out of a new network (a combination of FTTB and FTTH), very high bandwidth (1 Gbps) and very low prices (around EUR 18.75 per month). The penetration of subscribers versus home

Just In

15:08

Dialog Axiata to offer Starlink satellite service across Sri Lanka

14:51

Sri Lanka raises LKR 10 billion in 5G spectrum auction

14:00

Vi introduces Niyo Zero Forex Markup Card for travelers

13:39

True reshuffles executive team

Commentary

13:56

Video market set for slower growth ahead

11:38

Netflix buys Warner Bros to deepen content catalogue

11:11

KPN's mixed performance in Q3 raises questions for strategy day

15:26

Stock markets breaking records but what happened to Odido's IPO plans?

Background

01:04

The week in telecom: Wi-Fi bolt-ons take off to boost broadband growth, video market works on consolidation

01:39

The week in telecom: Netflix wins bidding for Warner Bros, Apple poaches new execs, Samsung debuts trifold

13:51

Proximus vs. Telenet: Proximus performs better in Q3 while Telenet uses up cash

14:16

Proximus Domestic still struggling with low margins

Complete profile

Before downloading the whitepaper, we would like to ask you to complete your profile with company and position. After confirming you will receive the white paper.