Singapore’s sovereign wealth fund GIC Pte Friday said it will invest £1.1 billion (British pounds), alongside four other institutional investors to acquire 33 per cent of the combined businesses of Three and O2 UK for £3.1 billion.
The other investors include, Canada Pension Plan Investment Board, Limpart Holdings Limited, a wholly owned subsidiary of the Abu Dhabi Investment Authority, Caisse de dépôt et placement du Québec and BTG Pactual of Brazil.
Overall, the deal will see Hutchison Whampoa Ltd sell a 33 per cent stake, or a third of its UK telecommunications business, to these investors. While GIC and Canada Pension Plan will pay £1.1 billion each, the remaining £900m will be jointly paid by Abu Dhabi Investment Authority, Quebec pension fund CDPQ, and BTG Pactual, the Brazilian banking group.
GIC said its investment is conditional to the completion of Three UK’s acquisition of O2 UK and the combination of both businesses, which are subject to EU regulatory approvals.
“The full proceeds of the investments will be used, together with a committed bank facility of £6 billion, to fund the O2 UK acquisition from Telefonica,” the statement from the Singapore fund added.
Earlier this year, Hutchison owned by of Hong Kong billionaire Li Ka-shing, had reached a deal to buy Telefonica’s British mobile unit O2 for nearly £10.3bn ($15.4 billion) and merge it with O2, which is Hutchison 3G’s UK Holdings unit. The deal, if approved, will make Hutchison UK’s largest mobile operator with 31 million customers, equivalent to 40 per cent mobile market share.