China Mobile and I Squared Capital have both made bids to acquire Hong Kong-based broadband provider HKBN.
China Mobile tabled an offer of HK$7.8 billion (US$1 billion), before I Squared Capital also made an offer for an undisclosed amount on the same day.
Bloomberg reported earlier this week that global infrastructure fund I Squared Capital had made a proposal to acquire all of the outstanding shares in HKBN via its portfolio company, HGC Global Communications Ltd.
A regulatory filing confirmed the bid made by I Squared Capital. Bloomberg reports that the offer could be worth HK$5 to HK$6 per HKBN share.
Meanwhile, the South China Morning Post reported that China Mobile is confident in its offer, which is HK$5.23 for each of HKBN’s 1.31 billion shares.
The publication reports that China Mobile has received irrevocable undertakings (aka binding agreements) from two of HKBN’s biggest shareholders, Canada Pension Plan Investment Board (CPPIB) and US private equity firm TPG.
China Mobile said the offer provides “all shareholders with an opportunity to realize their investment in the company for cash amid an uncertain market climate marked by geopolitical factors and uncertain sentiment in the broader equity markets, among others."
Collectively CPPIB and TPG own around 25 percent of HKBN, which covers 2.6 million homes with its broadband. The company also offers telecom solutions, data centers, and Wi-Fi services.
Other major shareholders in the business include the Canada Pension Plan Investment Board and Singapore's GIC Pte.
Last year, Hong Kong-based fixed-line telecom operator HGC Global Communications, owned by I Squared Capital, was also linked with a deal to buy HKBN, again for a sum of $1 billion.
I Squared Capital acquired HGC for HK$14.5 billion ($1.86bn) back in 2017. HGC is a competitor to HKBN, offering similar services to customers across the territory.
China Mobile is the world's largest mobile phone carrier for subscribers, surpassing one billion earlier this year. For context, that's twice the amount of the next-largest carrier, Reliance Jio in India which has just under 500 million.
In 2021, China Mobile International Limited (CMI) broke ground on its data center build in Hong Kong, on a 1 million square foot site in the Fo Tan area of Sha Tin, New Territories. The project is set to be completed next year.
