Telstra completes sale of Autohome stake
Telstra today announced the completion of its sale of 47.4 percent of the total issued shares in Chinese online business Autohome to Ping An Insurance Group for US$1.6 billion (A$2.1 billion).
Telstra CEO, Andrew Penn, said Telstra would book an accounting gain of A$1.8 billion on the sale, the final amount being subject to a number of completion adjustments including foreign exchange rates.
“As previously announced, most of the proceeds from this sale will be used to fund a capital management program of at least A$1.5 billion to commence in the first half of the 2017 financial year. We will provide more detail on the capital management program at our full year results in August,” said Mr Penn.
“Autohome has been an excellent investment for Telstra and we are pleased to have realised significant value for Telstra shareholders through this sale.
“Ping An will be an important strategic partner for Autohome. Its nationwide footprint in China and experience and expertise in auto financing, insurance and e-commerce mean Ping An is well placed to help Autohome develop outside of its traditional focus on online advertising.”
President of Ping An Trust, Leng Peidong, said that with nearly 300 million online users, 150 million financial customers, longstanding relationships with car manufacturers and distributors, and a nationwide offline service network, Ping An would play an important role in the transformation of Autohome into a full auto transaction service platform.
With the transaction now complete, Telstra retains a 6.5 per cent interest in Autohome. The number of Telstra nominee directors on the Board of Autohome has decreased from six to one.
There is residual litigation in the Cayman Islands relating to Autohome and this transaction which Telstra is contesting.
Disclaimer: This announcement does not constitute an offer to sell, or a solicitation of an offer to buy, any securities in the United States. Additionally, any securities mentioned herein have not been, and will not be, registered under the U.S. Securities Act of 1933, as amended (the “U.S. Securities Act”) or the law of any state of the United States, and may not be offered, sold or resold, directly or indirectly, in the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the U.S. Securities Act and applicable U.S. state securities laws.
This announcement contains statements that may constitute “forward-looking” statements pursuant to the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “will”, “expects”, “anticipates”, “future”, “intends”, “plans”, “believes”, “estimates” and similar statements. Statements that are not historical facts, including statements about Telstra’s beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. Such forward-looking statements are based on numerous assumptions regarding the present and future business strategies of Telstra. All information provided in this announcement is as of the date of this announcement, and Telstra does not undertake any obligation to update any forward-looking statement, except as required under applicable law.
1 Since Telstra first announced the transaction with Ping An for 47.7% of shares in Autohome, the company’s total number of issued shares has increased due to new shares being granted as part of Autohome’s employee incentive plans.