HONG KONG: Richard Li tightens grip on PCCW with share purchases

http://www.asiamedia.ucla.edu/article-eastasia.asp?parentid=59109


HONG KONG: Richard Li tightens grip on PCCW with share purchases

Principal shareholder says he feels confident about the telecom

South China Morning Post
Friday, December 7, 2006

Richard Li Tzar-kai has further tightened his grip on PCCW by buying more shares and redeeming bonds convertible into the company's shares.

Pacific Century Regional Developments, 75 per cent owned by Mr Li, yesterday said it paid US$173.9 million to redeem US$150 million of bonds indirectly held by American International Group.

As the bonds can be swapped into PCCW shares, the early redemption will prevent dilution of Mr Li's holding in the company.

He also bought 11.3 million PCCW shares at an average HK$4.777 each on December 4 after snapping up 41 million shares at an average HK$4.841 each on December 1, stock exchange filings show.

The purchases lifted his stake in the company to 27.16 per cent from 26.38 per cent.

PCCW's stock rose 0.83 per cent to close at HK$4.85 yesterday.

"I'm very confident about PCCW," Mr Li said yesterday, without revealing whether he will buy more.

Mr Li bought the shares after PCRD shareholders voted against a planned sale of his PCCW stake to a group led by former Citigroup banker Francis Leung Pak-to, preventing China Netcom Group from wresting control.

"Mr Li is buying shares because he wants to make sure he stays in control of PCCW," Nomura Securities analyst Kelvin Ho said.

China Netcom, which owns 20 per cent of PCCW, may still try to increase its stake by buying shares from investors, Mr Ho said.

"We have no plans right now to either increase or decrease our stake in PCCW," said Li Tao, a Beijing-based spokesman for China Netcom's Hong Kong-listed unit.

Date Posted: 12/7/2006