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Hong Kong, April 21 /SHfn/ -- Managing Director Alex Arena was quoted as saying that Pacific Century CyberWorks was sitting on investment paper profits of US$1b on the eve of its first results announcement just one month ago. Stockhouse marks to market the value of Pacific Century`s listed investments and finds only US$133m left in the kitty five short weeks later. "Millions are lost in the sands of time," rued Ross Johnson, former President of RJR Nabisco. The sands of time have passed quickly for Chairman Richard Li and Pacific Century CyberWorks [1186]. Less than one month after its initial results announcement and Mr Arena`s statement that the Company was sitting on unrealised investment securities gains of US$1.0b (initially misquoted but later clarified), Pacific Century finds 87 percent of these paper profits wiped out, its own share price 51 percent lower and its bid for C&W HKT [8] in jeopardy. The value of Pacific Century`s venture capital investments in 14 listed companies, five of which made up the bulk of the US$1.0b in paper profits, has fallen dramatically, along with the NASDAQ and Hang Seng Indices amid a global correction in technology equity prices. NASDAQ-listed internet investment company CMGI [CMGI], was at that time, the Company`s star performer, trading at US$121.38 per share, 181.3 percent above Pacific Century`s September 1999 split-adjusted entry price and giving rise to an unrealised gain of US$657.9m. Despite rebounding off its recent lows, the share price of CMGI closed Wednesday trading at US$60.44, erasing more than US$517m from Pacific Century`s portfolio. Other investments have also fared as poorly. Pacific Century`s holdings in Softnet [SOFN] and City Telecom [1137] are now underwater while those in Hikari Tsushin International [2990], formerly Golden Power International, and tom.com [8001] are worth 17 percent of their value one month ago. According to Stockhouse calculations, the US$1.0b in unrealised gains bandied about by Mr Arena currently stands at US$132.9m. Pacific Century`s own stock price has fallen inline with those of its investments. From a February high of $28.50, the stock closed Thursday trading at $14.00. Cynics have every reason to feel smug. They claimed that Mr Li had engineered an equity spiral in the share price of his own company by capitalising on buoyant markets and a good story, ultimately allowing the nine-month old internet start-up, albeit with fabulous connections, to bid US$38b for C&W HKT [8]. Mr Li then announced a US$3b tie up with Australia`s Telstra [X.TLS], with Telstra coughing up the US$3b for a 40 percent stake in HKT`s mobile phone assets and a US$1.5b PCCW convertible bond. Market observers screamed that it was a pre-selling of C&W HKT assets in order to pay down the US$12b needed to finance the original deal. As the share price of Pacific Century continued to fall since the HKT announcement, speculation mounted that the bid would fall by the wayside. HKT shareholders have yet to vote on the scheme of arrangement proposed by Pacific Century. A 75 percent majority in favour would be required for the deal to go forward. Moreover, Telstra is facing increasing opposition at home to a tie-up with Mr Li`s Pacific Century. The Australian Government, more in tune to political pressure than any corporate, holds veto power, through its 51 percent holding. Press reports this week out of Australia have News Corp`s [X.NCP] Rupert Murdoch rekindling his interest in HKT. The News Corp-owned Australian reported that the Company was circling HKT, hoping that the fall in share prices would offer News Corp the opportunity to snatch the prize Asian telco asset away from Mr Li`s Pacific Century and Telstra. Based on share price valuations alone, HKT could well end up dialed in down under. |
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| aus der Diskussion: | PCCW, Berichte + Fakten, nur in deutsch |
| Autor (Datum des Eintrages): | Tronic (21.04.00 12:14:42) |
| Beitrag: | 29 von 286 (ID:836756) |
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