HSBC Holdings Plc (00005.HK) is providing Hutchison Whampoa Ltd. (00013.HK) with US$9 billion in loans to fund the latter’s acquisition of British cellphone operator O2, the Wall Street Journal reported Monday, citing sources familiar with the matter.
Hutchison, the conglomerate controlled by Hong Kong billionaire Li Ka-shing, announced last week that it is in exclusive talks to buy 02, the UK mobile unit of Spain’s Telefonica SA, for up to US$15.4 billion.
HSBC, which is advising Li on the transaction, will fund the deal partly with a loan, the report said.
The loan offer comes as the banking giant is helping the tycoon reorganize his empire into two entities, separating his Hong Kong property assets from his international businesses.
Once Hutchison buys O2, it is expected to sell as much as 30 percent of the company to institutional partners, including private-equity firms.
The O2 acquisition is likely to take around a year to be completed, sources told the Journal.
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