Hutchison Whampoa has announced it plans to sell a one-third stake in its UK mobile unit for £3.1bn.
Hutchison has entered into agreements with five investors, who will acquire stakes totalling 33%, to fund the acquisition of O2 UK from Telefonica, together with a bank facility of £6bn. The investments will be conditional on the completion of Three’s acquisition of O2, which is currently subject regulatory approvals that could take up to a year, and will only occur once O2 UK has combined with Three’s businesses.
Commenting on the agreement Canning Fok (pictured), Group Managing Director of HWL said: ‘The investors share our vision and belief in the value of creating a business with the necessary scale to enable us to compete effectively in the UK marketplace and to provide even better service and innovation using the largest and most resilient and advanced mobile network infrastructure in the country.
‘Like us, the willingness of these investors to commit substantial capital to this investment reflects continued confidence in the UK economy and its commitment to maintain and foster a dynamic and world leading telecommunications sector, as well as a vote of confidence in Europe’s plans for a single market in digital communications, leading to increased investment in the telecoms sector.’
The investors entering into the agreements are; Canada Pension Plan Investment Board, GIC of Singapore, Limpart Holdings Limited, CDPQ of Quebec, Canada and BTG Pactual of Brazil.
Fok added: ‘It is an honour to have such a strong collection of the world’s largest and most sophisticated investors joining us as partners in building the combined business of Three and O2 UK, which will be the number one mobile operator in the UK with nearly 33 million customers.’