Shares of HKBN (1310) once soared by 13 percent to HK$5.66 on a report that the Hong Kong telecommunications provider has received a takeover offer from rival HGC Global Communications that could value the company at more than US$1 billion (HK$7.8 billion), according to people familiar with the matter.
The stock was up 11.6 percent when trading was halted yesterday, without a reason given for the suspension. But it is still down 44 percent in the past 12 months, giving the company a market value of about HK$7.2 billion.
The asset could also draw interest from Chinese companies or funds backed by the government as the country steps up scrutiny of sensitive technology-related assets and tightens oversight over data security, the people said.
The new offer comes after a sale was put on hold last year as potential buyers expressed concerns over valuation amid market volatility. KKR and PAG were among suitors considering bids at the time, Bloomberg has reported.
HKBN offers broadband internet services to residential and corporate customers in the city. It also provides other enterprise telecom solutions, runs data centers, and offers Wi-Fi connectivity. Its major shareholders include buyout firms TPG and MBK Partners as well as Singapore's sovereign wealth fund GIC.
HGC is a fixed-line operator that owns infrastructure in Hong Kong and overseas, providing services including full-fledged telecom, data center, and broadband, according to its website. The company was founded in 1995 and was formerly known as Hutchison Global Communications. I Squared Capital bought the company in 2017 for HK$14.5 billion.
Deliberations are ongoing and might not lead to a transaction, the people said. Representatives for HGC, HKBN, MBK, and TPG declined to comment, while a representative for I Squared didn't immediately respond to requests for comment.
