MBK Consortium Agrees to Acquire Wharf T&T for $1.2 Billion

  • North Asian buyout firm teams with TPG in first Hong Kong deal
  • Private-equity group beat rivals including HKBN, SmarTone

A consortium of MBK Partners and TPG Capital agreed to acquire internet provider Wharf T&T Ltd., owned by billionaire Peter Woo’s Wharf Holdings Ltd., for HK$9.5 billion ($1.2 billion), in the largest Hong Kong telecom deal in about two years.

The all-cash deal for the business, which provides fixed-line services to mostly corporate clients in Hong Kong, should be completed by Nov. 23, the Hong Kong conglomerate said Tuesday in a statement.

Woo is offloading a telecom businesses he started in the run-up to the dot-com bubble in the 1990s to raise funds as his main property business slows. Wharf T&T had also drawn interest from suitors including HKBN Ltd. and SmarTone Telecommunications Holdings Ltd., people with knowledge of the matter said earlier. 

Wharf said in March it was reviewing businesses including Wharf T&T and pay-TV operator i-Cable Communications Ltd. In a separate Hong Kong exchange statement Tuesday, Wharf said a strategic review of i-Cable hasn’t been completed and it’s continuing to assess proposals for the unit from various independent third parties.

Track Record

Shares of i-Cable fell as much as 13 percent in Hong Kong trading Wednesday morning, the biggest decline since July 2015. The benchmark Hang Seng index was unchanged, while Wharf Holdings fell as much as 1.4 percent.

MBK, led by former Carlyle Group executive Michael Kim, has sought to amass telecom, media and cable assets across North Asia. The buyout firm has spent at least $3.3 billion on such acquisitions in Taiwan and South Korea, according to data compiled by Bloomberg. The Wharf deal is the firm’s first Hong Kong investment, the data show.

The deal for Wharf T&T is the biggest acquisition in the Hong Kong telecom industry since billionaire Richard Li’s HKT Ltd. bought wireless carrier CSL New World Mobility Ltd. from Telstra Corp. for $2.4 billion in 2014, the Bloomberg-compiled data show.

“We are very impressed with Wharf T&T’s successful track record of establishing a client base of over 50,000 enterprises in Hong Kong,” MBK partner Teck Chien Kong, said in a separate statement by MBK and TPG.

Before it's here, it's on the Bloomberg Terminal.