Conglomerate PCCW is looking to list its telecoms unit as a business trust in Q4 2011, Alexander Arena, PCCW’s group managing director, said during a conference call on 12 August. But the company still requires shareholders’ approval.
A business…
Conglomerate PCCW is looking to list its telecoms unit as a business trust in Q4 2011, Alexander Arena, PCCW’s group managing director, said during a conference call on 12 August. But the company still requires shareholders’ approval.
A business trust combines elements of a company with those of a unit trust, and is operated through a trustee manager. Investors in such a trust hold units rather than shares.
In June, the Hong Kong Stock Exchange approved PCCW’s application to spin off its telecoms assets, a transaction that could raise up to US$2bn. This is the first time that Hong Kong allows the listing of a business trust.
The company has hired NM Rothschild & Sons to advise on the transaction, which will only involve the disposal of a minority stake in the business.
Forming the business trust will therefore allow Richard Li, media tycoon and chairman of PCCW, to raise money without giving up control of the fixed-line operations.
With the proceeds, the company is looking to reduce its debt load and invest in its growth businesses, according to PCCW’s interim results for 2011.
