HONG KONG: SmarTone Telecommunications Holdings Ltd, Hong Kong’s No. 3 mobile phone operator, may buy a smaller rival and pay more dividends after BT Group Plc sells out of the company, chief executive Douglas Li said.
The former British phone monopoly agreed last week to sell its 21% stake in SmarTone to Sun Hung Kai Properties Ltd, giving Hong Kong’s biggest developer control of a company that has returned to profit after two years of losses.
“Now that one shareholder holds more than 50%, it’ll certainly have more flexibility to make decisions in future transactions,” Li said in an interview. “We’re interested in a consolidation move. We’ve partly allocated money for that.”
SmarTone, which serves 16% of Hong Kong cell-phone users, would gain size to compete with Li Ka-shing’s Hutchison Telecommunications (HK) Ltd and Telstra Corp’s Hong Kong CSL Ltd. Hutchison and CSL together have half of the market, where six mobile operators are signing up fewer new customers. Almost nine out of 10 people in the territory’s population of 6.8 million already have handsets.
SmarTone’s potential takeover targets include New World PCS Ltd, Sunday Communications Ltd and Peoples Telephone Co. – Bloomberg