CITIC Telecom International CTC has announced it will buy stakes from two companies for Macau's monopoly landline operator to raise its presence there in a bid to expand to Greater China.
The Hong Kong-based telecoms service provider said in a statement on Sunday will purchase 51 percent of Macau's monopoly landline operator Companhia de Telecommunicacoes de Macau (CTM), from British telco Cable & Wireless Communications (CWC), for US$749.7 million. It will also buy a 28 percent stake from Portugal Telecom for US$411.6 million. This will add to its existing stake of 20 percent to give it a total holding of 99 percent.
CTM provides mobile, fixed line and broadband services in Macau and is a major supplier of telecom services to corporate customers in the special administrative region of China.
"The business strategy for CITIC Telecom has been to expand its telecommunications business to Greater China," the company said. This acquisition will provide "an opportunity to take control of Macau's leading integrated telecom services provider and improve its performance".
The Macau phone operator, has the right to provide local and international switched fixed voice and data services to Macau, until Dec. 31 2016, the release noted.
CITIC Telecom will fund the purchase of the stakes with its current cash resources and new bank loans, the statement noted. It might consider raising fresh equity or bonds at a later stage to refinance the current facilities, it added.
In June 2012, the telecoms service provider had announced plans to set up a new cloud computing center in Singapore, kicking off its expansion plans into Southeast Asia, as it banks on its China presence as an advantage.