Telstra now has 100 per cent ownership of mobile carrier Hong Kong CSL Limited (CSL), after announcing an agreement with Pacific Century CyberWorks Limited (PCCW). Under the cashless transaction, Telstra acquired PCCW's 40 per cent interest in their mobile joint venture, Regional Wireless Company (RWC) giving Telstra 100 per cent ownership of CSL.
In return for Telstra's increased ownership, PCCW has redeemed in full the US$750 million 2007 convertible note held by Telstra and Telstra has subscribed for a new US$190m mandatorily converting secured note. After marking to market the US$750 million convertible note and adjusting for 40 per cent of the cash in CSL, the effective acquisition value of the interest in RWC is US$475 million.
Telstra's Chief Executive Officer, Dr Ziggy Switkowski, said: "This is an attractive asset for Telstra and demonstrates our commitment to Asia and expansion in mobiles. CSL is profitable, debt free, and has a strong reputation in the region. CSL will be a major spearhead for our wireless growth strategy in Asia.
Switkowski also said that CSL's pedigree of technical innovation in areas such as Multi Media Messaging (MMS) and Mobile Number Portability (MNP) provide great learning opportunities for Telstra and will produce opportunities in the Australian and international markets.
