HONG KONG, March 4 (Reuters) - Hutchison Telecommunications 2332.HK said it was to spin off its Hong Kong telephone business in a separate listing and distribute the unit's new shares to investors as an interim dividend.
Hutchison Telecoms, an emerging market telecoms arm of Hutchison Whampoa Ltd (0013.HK), has submitted an application for the listing of shares in Hutchison Telecommunications Hong Kong Holdings Ltd, it said in a statement on Wednesday.
The unit operates mobile telecommunications businesses in Hong Kong and Macau, along with a fixed-line telecommunications business in Hong Kong.
The dividend proposal was subject to the approval on the spinoff and the listing of the shares in Hong Kong by way of introduction, in which no new capital will be raised, it added.
Hutchison Telecoms also operates mobile telecommunications businesses in Vietnam, Thailand, Sri Lanka and Indonesia. It has a 51 percent stake in Israel-listed Partner Communications Co Ltd (PTNR.O)(PTNR.TA).
The company has no definite plans for spinning off other assets now, said Chief Executive Officer Dennis Lui.
"But there is a possibility of spinoff in Indonesia depending on certain conditions such as customers level," he told reporters.
Hutchison Whampoa, a port-to-telecoms conglomerate controlled by tycoon Li Ka-shing, owns 60.4 percent of Hutchison Telecoms, making it the controlling shareholder of the unit after the spinoff.
Hutchison Telecoms said the spin-off would create value for its shareholders, as its stock had been traded at a large discount to the value of its underlying business and a separate listing would allow its Hong Kong telephone arm to be valued on a stand-alone basis.
Lui said the firm has "no plan to sell our Hong Kong assets or any assets in other emerging countries except Thailand," but added that he has no timetable for that.
Hutchison Telecoms reported on Tuesday that net profit for 2008 fell 97 percent, in line with market expectations, to HK$1.9 billion ($244 million) from HK$66.9 billion the previous year, when its profits were inflated by asset sales.
Its stock ended up 0.95 percent on Wednesday and has risen nearly 16 percent in the past week on news that the company was considering spinning off the Hong Kong unit. It outperformed the blue chip Hang Seng Index .HSI, which lost 5 percent in the same period.
(Reporting by Nerilyn Tenorio and Sui-Lee Wee; Editing by Rupert Winchester)