Richard Li, chairman of PCCW, has agreed to sell 23 per cent stake in the Hong Kong-based telecom company for $1.2 billion to veteran investment banker Francis Leung. The owner of the stake, Singapore-listed Pacific Century Regional Developments, a Li-controlled company, will also reportedly finance 70 per cent of the purchase as Leung will have to make only an initial payment now and pay 70 per cent, plus interest in tranches by June 2008.

The chairman had failed to sell the company's telecom and media assets to competing foreign investors, Australia's Macquarie Group and US private equity firm, TPG Newbridge. China Netcom, PCCW's second largest shareholder, which opposed any sale of assets to the foreign groups, is backing Li's move.