David Chiu (inset) will become the new owner of I-Cable. Photo: Google Maps
David Chiu (inset) will become the new owner of I-Cable. Photo: Google Maps

I-Cable Communications Ltd. (01097.HK) will raise HK$704 million (US$90.5 million) by issuing 3.35 billion new shares, or 67.59% of its diluted stake, to an underwriter, triggering a change of ownership, according to a filing in the Hong Kong stock exchange on Thursday.

The paid television operator, in which The Wharf (Holdings) Ltd. (00004.HK) owns a 73.8% stake, said it will offer five shares for every three existing shares at 21 HK cents each, a discount of 65.57% on the last closing price of 61 HK cents on April 13.

The underwriter of the offer shares is Forever Top (Asia) Limited, in which New World Development (00017.HK)’s chairman Henry Cheng Kar-shun has a 31.5% stake and Far East Consortium (00035.HK)’s chairman David Chiu Tat-cheong has a 24.5% stake.

I-Cable needs to gain approval from its independent shareholders for the proposed transaction  in a special general meeting, which will take place on or before May 31. 

I-Cable’s shares, having resumed for trading after a three-day suspension, rose 16% to close at 71 HK cents on Friday.

Chiu said in a media briefing on Friday that he may reduce staff in I-Cable by 10% after the takeover but will maintain the editorial autonomy of the company’s news department.

For the 12-months ended December, I-Cable saw its net loss expand to HK$313 million from HK$233 million a year previously, according to its annual report. It had 2,137 employees at the end of last year.