$7.2B In TPG Share Will Come Into Play Next Week, Who Will Sell & Who Will Buy?
$7.2 billion dollars’ worth of shares in TPG Telecom, which is majority owned by CK Hutchinson Holdings Limited who are based in Chinese run Hong Kong and Mosman based billionaire David Teoh are set to come into play next week as the Company cuddles up to Telstra in an effort to share infrastructure in rural Australia.
The share that has been held in escrow allow founder David Teoh and strategic investors Vodafone and Hutchison to sell as much stock as they want for the first time in two years.
The big question now is will they and who would be the buyer.
Last week the Company that is facing an Australian Competition and Investment Commission investigation into their potential network sharing deal with Telstra faced a hostile Optus who claim that the TPG deal with Telstra should not go through as it is anti-competitive and will create a monopoly of spectrum and access to rural networks in Australia.
Observers are claiming that, as part of the ACCC investigation, the Federal Government should raise questions as to whether there are security risks – as CK Hutchinson Holdings Limited own 87.87% of Hutchinson Telecommunications Australia who in turn have an 11.1% of TPG Telecom Limited shares.
Hutchinson Telecommunications Australia also own 50% of Vodafone, who in turn owns 27.82% of TPG Telecom.
CK Hutchinson Holdings Limited is based in the Hong Kong Special Administrative Region (SAR) which for official purposes, is today part of China.
A potential buyer of the shares could be Macquarie Infrastructure with several banker’s keen to get hold of any stock that is sold.
According to the AFR the battle will kick off next Wednesday, when estimated 64 per cent of TPG Telecom’s shares can be sold.
The one they’re watching is David Teoh’s 14.2 per cent slice of TPG, with Vodafone and Hutchison seen as less likely to immediately sell down their holding in the carrier.
While Teoh’s notoriously hard to read, and only Macquarie has done much work for him in the past decade, he’s the one that sold most recently which is as good a guide as any.
Teoh has already sold $335 million (or 4 per cent) of the company, and within weeks he put up the money to pay cash for a $16M house for his son in Mosman.
TPG shares are currently climbing after being at $5.90 in January they are now trading at $5.97 but did reach $6.14 last month.