CTEL Hong Kong Television Network Ltd. (MM)

SIGNATURE

Pursuant to the requirements of section 12 of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Dated: January 3 ^rd , 2008

Exhibit 99.1

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt as to any aspect of this circular or as to the action you should take, you should consult your stockbroker or other registered dealer in securities, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in City Telecom (H.K.) Limited, you should hand this circular and the accompanying form of election at once to the purchaser or transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or the transferee.

The Stock Exchange of Hong Kong Limited takes no responsibility for the contents of this circular, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this circular.

(Incorporated in Hong Kong with limited liability under the Companies Ordinance)

(Stock Code: 1137)

SCRIP DIVIDEND SCHEME IN RELATION TO

THE 2007 FINAL DIVIDEND

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LETTER FROM THE BOARD

(Incorporated in Hong Kong with limited liability under the Companies Ordinance)

(Stock Code: 1137)

4 January 2008

To the Shareholders

Dear Sirs/Madams,

SCRIP DIVIDEND SCHEME IN RELATION TO

THE 2007 FINAL DIVIDEND

INTRODUCTION

The Company announced on 22 November 2007 that the 2007 Final Dividend would be paid to Shareholders whose names appeared on the register of members of the Company on the Record Date. Such Shareholders may elect to receive the 2007 Final Dividend in the form of New Shares in lieu of cash. The last day on which the transfers were accepted for the registration for participation in the Scrip Dividend Scheme was 18 December 2007. At the AGM, the 2007 Final Dividend was approved. The purpose of this circular is to set out the procedures and conditions which apply in relation to the Scrip Dividend Scheme and the action which should be taken by Shareholders if they wish to participate in the Scrip Dividend Scheme.

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LETTER FROM THE BOARD

DETAILS OF THE SCRIP DIVIDEND SCHEME

Shareholders may elect to receive the 2007 Final Dividend in one of the following ways:

The New Shares will rank pari passu in all respects with the existing issued Shares except that they shall not rank for the 2007 Final Dividend.

BASIS OF ALLOTMENT OF THE NEW SHARES

For the purpose of calculating the number of New Shares to be allotted pursuant to the Scrip Dividend Scheme, the market value per New Share will be HK$1.7072, which is the average closing price of HK$2.134 of one Share on the Hong Kong Stock Exchange for the five consecutive trading days ended 21 December 2007, less a 20% discount. Accordingly, the number of New Shares which a Shareholder electing for New Shares will receive will be calculated as follows:

The number of New Shares to be received will be rounded down to the nearest whole number of New Shares. Fractional entitlements to New Shares in respect of alternatives (b) and (c) above will not be issued to Shareholders but will be disregarded and the benefit thereof will accrue to the Company. The last day on which Shareholders will be entitled to select their desired form of dividends is 23 January 2008.

ADVANTAGES OF THE SCRIP DIVIDEND SCHEME

The Scrip Dividend Scheme will give Shareholders an opportunity to increase their investment in the Company at market value without incurring brokerage fees, stamp duty and related dealing costs. The Scrip Dividend Scheme will also benefit the Company to the extent that such cash which would otherwise have been paid to Shareholders who elect to receive the New Shares, in whole or in part, in lieu of a cash dividend, will be retained for use as working capital by the Company.

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LETTER FROM THE BOARD

EFFECT OF THE SCRIP DIVIDEND SCHEME

Based on 627,048,404 Shares in issue as at the close of business on the Record Date, if no elections for the New Shares were received, the total cash dividend payable by the Company would be HK$25,081,936.16. If all Shareholders elect to receive their entitlements to the 2007 Final Dividend in the form of New Shares, the maximum number of New Shares to be issued would be 14,691,855 Shares representing approximately 2.34% of the existing issued share capital of the Company and approximately 2.29% of the then issued share capital of the Company as enlarged by the issue of the New Shares.

Shareholders should note that the New Shares may give rise to notification requirements under Part XV of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong). Shareholders who are in any doubt as to how these provisions may affect them are recommended to seek their own professional advice. Shareholders who are in any doubt as to their taxation position are also recommended to seek their own professional advice.

ELECTION FORM

If you wish to receive your 2007 Final Dividend wholly in cash, you do not need to take any action.

If you elect to receive your 2007 Final Dividend wholly in New Shares, or partly in cash and partly in New Shares, you should use the enclosed election form. If you sign the election form but do not specify the number of Shares in respect of which you wish to receive New Shares, or if you elect to receive New Shares in respect of a greater number of Shares than your registered holding as at the Record Date, you will be deemed to have exercised your election to receive New Shares in respect of all the Shares of which you were then registered as the holder.

The election form should be completed in accordance with the instructions printed thereon and returned to the Company’s share registrar so as to be received no later than 4:30 p.m. on 23 January 2008 at:

Computershare Hong Kong Investor Services Limited

Shops 1712-1716, 17th Floor, Hopewell Centre

183 Queen’s Road East

Wanchai

Hong Kong

Elections in respect of the 2007 Final Dividend cannot be in any way withdrawn, revoked, superseded or altered after the relevant election forms are signed and lodged with the Company’s share registrar. No acknowledgement of receipt of the election form will be issued.

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LETTER FROM THE BOARD

SHAREHOLDERS RESIDENT OUTSIDE HONG KONG

The Company is not aware that it has any Shareholder with a registered address outside Hong Kong as at the Record Date. Accordingly, there will not be any legal restriction or statutory requirement outside Hong Kong in allowing Shareholders to participate in the Scrip Dividend Scheme. Holders of the American Depositary Receipts (each representing 20 Shares), of which are listed on the NASDAQ Stock Market in the United States of America, are not entitled to participate in the Scrip Dividend Scheme.

This circular and the form of election will not be registered in Hong Kong or any other jurisdiction.

STOCK EXCHANGE LISTING, CLEARING AND SETTLEMENT

Application will be made to the Hong Kong Stock Exchange for the listing of, and permission to deal in, the New Shares. It is expected that the certificates for the New Shares, and cheques for cash entitlements, will be posted to Shareholders at the risk of those entitled thereto on or about 4 February 2008. Dealings in the New Shares on the Hong Kong Stock Exchange are expected to commence after dispatch of the share certificates for the New Shares to Shareholders. Subject to the granting of listing of, and permission to deal in, New Shares issued pursuant to the Scrip Dividend Scheme on the Hong Kong Stock Exchange, such New Shares will be accepted as eligible securities by Hong Kong Securities Clearing Company Limited for deposit, clearance and settlement in the Central Clearing and Settlement System. Shareholders should seek the advice of their licensed securities dealer or other professional adviser for details of these settlement arrangements and how such arrangements will affect their rights and interests.

The Shares are listed, and dealt in, on the Hong Kong Stock Exchange. The Shares are also listed in the form of American Depository Receipts (each representing 20 Shares) on the NASDAQ Stock Market in the United States of America. The Company’s US$125,000,000 Senior Notes due 2015 are listed on the Singapore Stock Exchange. Other than the foregoing, no equity or debt securities of the Company are listed, or dealt in, on any stock exchange nor is listing, or permission to deal in, on any other exchange being, or proposed to be, sought.

New Shares issued to Shareholders pursuant to an election to receive some or all of their 2007 Final Dividend in New Shares may be allocated in odd lots. No special dealing arrangements will be put in place by the Company to facilitate the trading or disposal of New Shares issued in odd lots. Shareholders should be aware that odd lots usually trade at a discount to the price of board lots.

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LETTER FROM THE BOARD

CONDITION OF THE SCRIP DIVIDEND SCHEME

The Scrip Dividend Scheme is conditional upon the Listing Committee of the Hong Kong Stock Exchange granting listing of, and permission to deal in, the New Shares. In the unlikely event that the above condition is not satisfied, Shareholders will receive the 2007 Final Dividend wholly in cash.

ADJUSTMENTS IN RELATION TO SHARE OPTIONS UNDER THE SHARE OPTION SCHEME

In accordance with the terms of the share option scheme adopted by the Company on 23 December 2002, the New Shares to be allotted may result in an adjustment to the exercise price and/or the number of option so far as unexercised in respect of share options granted by the Company. Such adjustments shall give the option holder the same proportion of the issued share capital of the Company as that to which such option holder would otherwise entitle, but no such adjustments shall be made where, and to the extent that, such adjustments would result in any Shares being issued at less than their nominal value. If and when any adjustments have to be made, the Company will notify the option holders in accordance with the said share option scheme.

GENERAL

Whether or not it is to your advantage to receive cash or New Shares, in whole or in part, depends upon your own individual circumstances, and the decision in this regard and all effects resulting from that decision are your responsibility. If you are in any doubt as to what to do, you should consult your professional advisers as to the action you should take and whether or not you are permitted to receive the 2007 Final Dividend in scrip form or if any government or other consent is required. Shareholders who are trustees are recommended to take professional advice as to whether electing for New Shares is within their powers and as to its effect having regard to the terms of the relevant trust instrument.

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