Word: hkt
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Hong Kong tycoon Richard Li seemed to be walking on air last March when he used his 10-month-old start-up, Pacific Century CyberWorks, to acquire the territory's dominant telecommunications company, Cable & Wireless HKT. The $35.9 billion merger was the largest in Asia outside Japan. Analysts fell over one another to issue buy recommendations on CyberWorks' stock, which they predicted would soar into the stratosphere. Whoops! Put a hold on that order. Six months later, analysts say the new firm's strategy of linking broadband Internet services to an Old World telco is no longer so compelling...
...billionaire and a major player in the real estate market, and in retail, telecommunications and power generation. His port operation handles 30% of Hong Kong's trade. His nickname in the press is Superman. Now comes Superboy: Li's son Richard, 33. Last month, Richard took over Cable & Wireless HKT, the territory's telecom giant, using an Internet company he started only 11 months ago called Pacific Century CyberWorks. The deal, valued at $38 billion, was Asia's biggest takeover ever...
When Britain's Cable & Wireless, which owned 54% of Hongkong Telecom, announced its intention to spin off non-core businesses like HKT, Richard realized that HKT had assets he could use. Chief among them: its broadband Internet service, which has 100,000 customers; its cellular-phone system and the potential of new, third-generation cellular technology to enable Internet access; and rights to a valuable deal signed by Murdoch's Star TV to provide television shows for HKT's broadband network. He eventually offered shareholders a package of shares and cash that could cost him $12 billion...
Even in his hour of triumph, Richard finds it hard to get 100% of the credit. Many analysts point out that all of Hong Kong's telecom licenses expire in 2006, and the decision on whose gets renewed will surely be made in Beijing. That's why HKT chose Richard, the analysts say--because Li Ka-shing's clout in China will smooth the way. To others, however, it looks like Superboy is perfectly capable of flying...