Portugal Telecom, SGPS, S.A. (PT) announces that it has entered into a definitive agreement for the sale of its minority equity stake held in Companhia de Telecomunicações de Macau, S.A.R.L. (CTM), representing 28% of CTM’s share capital, to Citic Telecom International Holdings Limited (CITIC Telecom).
This sale has been approved by the Board of Directors of PT and is conditional upon the satisfaction of a set of precedent conditions, notably the successful completion of the transfer of an equity stake representing 51% of the share capital of CTM by Sable Holding Limited (Sable), a wholly-owned subsidiary of Cable & Wireless Communications Plc, to CITIC Telecom and the approval of both transactions by the Government of Macau and by the relevant People’s Republic of China governmental and regulatory authorities.
This agreement provides that PT will receive total proceeds of USD 411.6 million, subject to certain adjustments, on a cash-free and debt-free basis and assuming a normal level of working capital. As at 31 December 2012 CTM had a net cash position of USD 70 million.
CITIC Telecom and PT also entered into a strategic alliance agreement for capitalising on their respective expertises in certain areas of collaboration in the telecom sector and in the identification of ICT investment opportunities in order to create value for their respective shareholders. Pursuant to this strategic alliance agreement, CITIC Telecom will select PT as the CITIC Telecom Group’s strategic ICT service provider.