HONG KONG (AP) -- Australia's Telstra said Friday it was selling its Hong Kong mobile phone business to Hong Kong billionaire Richard Li's telecom company in a deal worth $2.4 billion.
Telstra Corp. said it would earn about 2 billion Australian dollars ($1.8 billion) from selling its 76.4 percent stake in CSL to Li's HKT Ltd., which is also buying the other 23.6 percent from another company, New World Development.
The deal allows Li's company, which already owns a separate mobile operator, to beef up its presence in the city's saturated mobile market. It also lets Telstra make a profitable exit ahead of a shakeup by the city's telecommunications regulator aimed at boosting competition.
Telstra CEO David Thodey said in a statement that "there are a number of dynamics in the Hong Kong mobiles market that means this is the right opportunity for Telstra to maximize our return on this successful asset."
The city's communications regulator plans to take back a third of the spectrum from four current license holders after they expire and auction it off, a move that will allow China Mobile to acquire its own spectrum. Beijing-based China Mobile, which is the world's largest mobile phone company with more than 750 million subscribers, currently leases bandwidth from rivals.
The sale will help HKT compete for business from Hong Kongers, who are avid mobile phone users. The city had 16.7 million mobile accounts as of June, more than double the population of 7.1 million.
HKT said after the deal, which still needs approval from Hong Kong regulators, the company would have 31 percent of Hong Kong's mobile phone market.
"HKT believes that no significant competition concerns arise in relation to the proposed acquisition," the company said in a statement.