However, the decision to proceed with the bid would depend on Telstra's shareholders, PCCW chairman Richard Li told reporters after the company's annual general meeting in Hong Kong today.
Should Regional Wireless' bid fail, PCCW will dispose of its entire 15 percent stake in M1, Li added.
The Hong Kong telco's existing stake is held through Great Eastern, its joint venture with Cable and Wireless Plc (C&W). The other M1 shareholders are Keppel T&T (35 percent), Singapore Press Holdings (35 percent) and C&W (15 percent).
When contacted, Telstra spokesperson Martin Ratia declined to provide any details. "We're not making any comment on this matter. Any announcement will be made at the appropriate time," Ratia said without elaborating.
The deadline for interested parties to submit firm bids has been set for May 28, said Keppel Corp executive chairman Lim Chee Onn at the company's AGM in Singapore this morning.
On April 4, Keppel T&T said that M1 shareholders were looking to dispose of their stake in the telco. JP Morgan is advising SPH and Keppel T&T, while Merrill Lynch is advising Great Eastern.
Subsequently, Singapore's largest telco, Singapore Telecommunications Ltd, said it was looking to acquire M1 to boost market share and improve "efficiency". However, SingTel scrapped its plan Monday citing regulatory issues and failure to obtain the bidding document.
Other potential bidders were reportedly Hong Kong's Hutchison Whampoa and Malaysia's Maxis Communications. However, The Straits Times reported today that Hutchison Whampoa has denied plans to buy a stake in M1, while a Maxis spokesperson said earlier that it was not interested in the Singapore mobile operator.
Analysts had estimated M1's price tag to be between S$2 billion and S$3 billion. The mobile phone operator had a profit before tax of S$79 million on sales of S$570 million last year. Its average revenue per user was about S$70 on a subscriber base of 800,000 as at last December.
Established in February, Regional Wireless, which is 60 percent owned by Australia's largest phone company Telstra and 40 percent by PCCW, started operations with PCCW's mobile unit, CSL (previously Cable & Wireless HKT CSL).
PCCW claims that CSL currently has 1 million subscribers. PCCW is Hong Kong's dominant fixed-line operator and second-largest mobile phone company, following its merger with Cable & Wireless HKT last August.
Telstra and PCCW's other regional joint ventures include Reach, an Internet protocol (IP) backbone company and Internet Data Center Co, which aims to establish data centers in the region.
Staff writer Jack Lee reporting from Hong Kong.