Optus brings down "for sale" sign
SYDNEY, Australia (CNN) -- Cable & Wireless Optus effectively hung out the "for sale" sign on its A$10 billion of assets in late September 2000.
Prodded by its London-based parent Cable & Wireless plc, that was when Optus announced it would conduct "a compehensive review of structural and strategic options" for all three of its units: mobile, data & business, and consumer & multimedia.
But the Australian market had been expecting such a move from some months earlier, when it became clear that Cable & Wireless, Optus' 52.5 percent majority shareholder, was looking to exit some more of its Asia-Pacific assets.
It had already sold off Hong Kong Telecom to Richard Li's Pacfic Century CyberWorks for $28 billion in what was Asia's biggest telco deal of 2000.
Singapore Telecommunications was an aggressive bidder for HKT but could not match the Li glamour and connections. SingTel's government ownership, through Temasaek Holdings's 78 percent stake, was also seen as a major stumbling block.
On October 11 last year, two weeks after Optus put its assets on the block, Optus chief executive Chris Anderson said that it would "take some time" to develop the best course of action.
SingTel emerged early as hot favorite
But it did not take long for SingTel to emerge as a hot favorite.
SingTel had the ready cash, it was desperate to continue its regional expansion after being rebuffed in Hong Kong and Malaysia, and importantly, it was prepared to keep the three Optus business units together.
This was in contrast to other potential suitors such as Vodafone, which wanted only the mobile phone assets. Part of its proposal was to sell a minimum 1 million Optus mobile subscribers to Hong Kong conglomerate Hutchison Whampoa's Australian unit, Hutchison Telecommunciations Australia.
Vodafone said this would help the emergence of Hutchison as a significant third national mobile operator in Australia. But the Australian Competition and Consumer Commission indicated it would find the proposal hard to approve, and Vodafone withdrew from the bidding on Sunday, saying it could not see value for its shareholders.
Telecom New Zealand was another potential suitor but was always seen as under-funded.
The successful SingTel bid marks the end of a dramatic decade for Optus, which won the license to become Australia's second telecommunications carrier in 1991. At the time, shareholders in the consortium included Cable & Wireless, Bell South, and several large Australian corporations (Mayne Nickless, AMP, National Mutual) which owned Optus Pty Ltd.
The deal is subject to approval by Australia's Foreign Investment Review Board, but SingTel chief executive Lee Hsien Yang said in Sydney on Monday that it believed it had the Australian government's support.
Highlights of the Optus decade
November 1991: Consortium that includes Cable & Wireless pays A$800 million for Australian license.
January 1992: Optus Communications begins operations as Australia's second telecom carrier.
May 1996: Former head of Kodak Australia Dr Ziggy Switkowski becomes CEO of Optus, resigns in June 1997.
July 1997: Cable & Wireless gains majority control of Optus, renames company Cable & Wireless Optus
August 1997: Chris Anderson, former head of Television New Zealand and newspaper group John Fairfax, becomes CEO of Optus.
November 17, 1998: Optus lists on Australian Stock Exchange.
February 1999: Switkowski becomes CEO of Optus rival Telstra, Australia's biggest telco.
September 1999: Optus loses bidding war with Telecom New Zealand for mobile reseller AAPT.
February 2000: SingTel beaten by PCCW in bidding for C&W Hong Kong Telecom.
April 2000: Telstra, PCCW unveil regional expansion plans through joint ventures.
September 2000: Optus confirms strategic review of all parts of its business, initiated by 52.5 percent parent Cable & Wireless.
Late 2000-early 2001: SingTel, Vodafone Pacific and Telecom NZ identified as potential bidders for some or all of the Optus business units.
February 8, 2000: Vodafone submits indicative proposal to acquire Optus, involving Hutchison Telecommunications (Australia) taking over a minimum 1 million of Optus mobile customers.
February 15, 2001: SingTel submits indicative expression of interest in Optus.
March 7, 2001: Telstra's Switkowski announces record net profit of $2.62 billion for half year to December 2000.
March 22, 2001: Optus bids A$248.87 million for 3G spectrum in Australia, including A$241.1 million for a national license
March 25, 2001: Vodafone Pacific withdraws, saying the deal "did not meet our return criteria".
March 26, 2001: SingTel announces offer for Optus with equity purchase price of A$14.9 billion to A$16 billion.
Cable & Wireless plc
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