Hong Kong-based Hutchison Whampoa [0013.HK] had begun legal action against its partner KPN [KPN], after the Dutch company refused to provide a GBP150 million loan for the UK business. But now Hutchison has agreed to buy KPN’s 15% stake in the project for GBP90 million.
In April, the 3 UK network asked its shareholders for GBP1 billion of loans to help fund development of the new system.
Hutchison provided GBP650 million and Japan’s NTT [NTT] GBP200 million.
But KPN refused to provide its share, claiming the agreement under which it owned 15% of 3 UK did not require it to lend the money.
It had already written-off the value of its stake in 3 UK and offered it for sale last year.
Hutchison began legal proceedings against KPN in the summer, and KPN countersued, demanding Hutchison bought its 15% stake in 3 UK at 140% of its value. Fortunately for everyone’s sake the matter has now been resolved in the nick of time.
