Telstra has inked an agreement to sell its Hong Kong-based mobiles business CSL to HKT Limited for US$2.4 billion.
The sale, which is subject to regulatory and security-holder approval, would boost Telstra's bank balance by around A$2 billion for its 76.4 per cent shareholding.
HKT will also acquire the remaining 23.6 per cent shareholding held by New World Development.
Telstra chief executive David Thodey said the sale was a great opportunity to maximise shareholder value. It is expected to generate a profit on sale of approximately A$600million.
He said CSL has performed strongly with compound annual revenue growth of 9.4 per cent over the last three years.
"We are proud of CSL’s achievements. It has established itself as a premium brand and strong player in the market, last year adding 425,000 mobile customers,” Thodey said.
“However, there are a number of dynamics in the Hong Kong mobiles market that means this is the right
opportunity for Telstra to maximise our return on this successful asset.”
Thodey said Asia was a very diverse region and remained an important part of Telstra’s strategy.
“We want to leverage our domestic strengths to grow our global footprint. The team is focused on refining and enhancing our strategy across Asia and identifying further opportunities to build our capability in the region,” he said.
Telstra recently increased its stake in Chinese automobile information site Autohome and successfully listed it on the NYSE, he said. Telstra’s investment is now valued at US$1.9 billion, he said.
Telstra is not the only Australasian telco divesting. This morning, Telecom New Zealand announced it was considering selling its 60 per cent stake in Telecom Cook Islands.
There is ongoing pressure to reform the Cook Islands market, remove Telecom Cook Islands' exclusive license and open the market to competiitve services and investment.