Cable & Wireless Plc has decided to reduce its exposure to the Hong Kong economy and is negotiating to sell a stake of between 10% and 20% in Hong Kong Telecommunications Ltd, in which it currently holds 75%. The talks are with China International Trust & Investment Corp Hong Kong Holdings Ltd, an investment vehicle of the Chinese government. Cable & Wireless says that the talks are at a preliminary stage, and that it definitely intends to maintain a majority in and management control of the Hong Kong phone company. If a deal is sealed, the price is likely to be the average market price of Hong Kong Telecom during November. At the November average price, 10% would bring Cables UKP350m, 20%, UKP700m. The news was good for a 40 pence-plus two-day rise in the Cables share price just before Christmas.
