Telstra to sell stake in Hong Kong's CSL

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Telstra to sell stake in Hong Kong's CSL
David Thodey.

Talks up a $600m net gain.

Telstra has agreed to sell its Asian mobile carrier, CSL, for US$2.42 billion - a transaction that will net Australia's incumbent an extra $600 million of cash flow.

Subject to shareholder and regulatory approval, the sale of Telstra's 76.4 percent interest in the Hong Kong-based cellco to HKT Limited should net Telstra AU$2 billion.

Telstra calculates that this amounts to a A$600 million profit since it bought into CSL in 2001/2002.

Telstra chief David Thodey noted that the business had been performing well and said the sale was about "maximising shareholder value" more so than Telstra winding back its investments in Asia.

Asia is a "very diverse region," he said in a statement to the ASX, "with each market having its own characteristics and opportunities, and we need to consider these individually as we look to maximise value for our shareholders."

At present, 3G mobile spectrum allocation is fairly evenly split in Hong Kong between four competitors. But the Government has announced that it intends to take back up to one third of that spectrum in 2015 for re-allocation, potentially to new competitors,

With mobile penetration in Hong Kong approaching an incredible 200 percent, there is less certainty of strong growth compared to developing areas of Asia.

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