Li Ka-shing plans more telecom sales in ‘cash is king’ strategy

Published Thu, May 7, 2026 · 08:52 AM

[HONG KONG] CK Hutchison is considering further sales of telecommunication assets following the US$5.8 billion disposal of its UK mobile business, as it seeks to exit a sector that’s become increasingly competitive and expensive, according to sources familiar with the matter.

The Hong Kong-based conglomerate founded by billionaire Li Ka-shing is unlikely to rush into deals in the near term as it wants to maximise the value of its assets, said the sources, who asked not to be identified when discussing private deliberations.

The company may also still change strategy depending on market conditions, while a listing of its telecom assets remains an option, they said.

CK Hutchison did not immediately respond to a Bloomberg News request for comment.

The VodafoneThree disposal marks the second major UK asset sale announced by CK Hutchison and its affiliates this year, for a combined total of about US$20 billion. That underscores the group’s focus on building a war chest to help it weather growing economic uncertainty and heightened trade tensions, which have already made the planned US$19 billion sale of dozens of its global ports a geopolitical flashpoint.

Additional transactions would also free up funds for chairman Victor Li as he seeks to reshape his father’s business empire. While the elder Li earned his billions by investing early in sectors such as ports, telecommunications and retail, his son is now tasked with navigating a world defined by rapid technological innovation.

‘Cash is king’

CK Hutchison’s sale of its 49 per cent stake in VodafoneThree this week came just a year after the conglomerate merged its UK unit with Vodafone Group’s operation, creating the country’s biggest mobile carrier. That was earlier than expected by some analysts, as the merger had allowed a three-year window for an exit.

“This is consistent with CK Hutchison’s strategic priority to recoup as much cash as possible, as management holds a cautious outlook for global macro,” Karl Chan and other JPMorgan Chase analysts wrote in a recent research note. The group is also seeking to turn more asset-light in its investments, they added.

CK Hutchison had HK$143.7 billion (S$23 billion) in cash and cash equivalents as at Dec 31, 2025, up from HK$121.3 billion a year earlier.

Apart from the proposed ports sale, the conglomerate is also mulling a potential listing of its retail arm, which could raise at least US$2 billion. The group will have divested from most of its core business operations, which it had held onto for decades, if all those deals are completed.

CK Hutchison still operates telecom businesses in several European markets, including Italy, Sweden and Denmark. It has a controlling stake in Hutchison Telecommunications Hong Kong Holdings, which provides mobile services in the city and Macau. It also runs services in Australia and South-east Asia via joint ventures.

While telecom remains CK Hutchison’s second largest revenue-generating operation, it’s been suffering from steep depreciation and amortisation, dragging down the group’s profit attributable to shareholders. The company’s earnings from the sector last year plunged more than 80 per cent after factoring in depreciation and amortisation, according to its annual report.

The telecom industry also faces intensifying competition that will require billions of US dollars of investment in the coming years to keep pace with new generations of mobile networks.

The pricing for the UK business is better than expected, coming at 41 per cent above the estimated enterprise value for the operations, CLSA analyst Jeffrey Kiang said in a research note. The deal is expected to lift CK Hutchison’s net asset value and overall recurring profit for this year, Kiang said.

While global tensions and technological development are fuelling uncertainty for many multinationals, Victor Li said in March that those “disruptive changes” also generate opportunities. Victor, who took control of his father’s company in 2018, had been seeking further expansion in the infrastructure sector in recent years, with mixed results.

CK Hutchison unit CK Infrastructure Holdings has pursued a bid for UK smart-metre assets and expressed an interest in the country’s Thames Water. But it pulled out of the bidding for a British liquefied natural gas terminal, Bloomberg reported last year.

“Cash is king” amid the current turmoil, CK Infrastructure executive director Andrew Hunter told shareholders in a meeting in April, explaining why the CK group agreed to sell the UK’s largest power-distribution network for £10.5 billion (S$18 billion) earlier this year. “Ample capital will unlock a range of future options and opportunities for us.” BLOOMBERG