>> China Unicom Is Taking Into Consideration Minority Stake Sales
January 18, 2001
GSMBOX
MobileNews
Company officials said on Wednesday that China Unicom, China's second largest cellular company, is taking into consideration minority stake sales to strategic foreign investors.
Long Wenxiang, assistant manager of investor relations for Unicom in Hong Kong, said that these might include Japan's NTT DoCoMo, Deutsche Telekom and AT&T of the US.
According to him, such a move would help improve the company's readiness for China's entry to the World Trade Organisation, which is expected to occur this year.
Mr Long said that they haven't yet started negotiations. But with China's impending entry to the WTO, they need to consider minimal stake sales.
If the plan come true, Unicom would be following in the steps of China Mobile (Hong Kong), the mainland's largest cellular operator, which last year sold a two per cent stake to Vodafone of the UK.
That deal included agreements for cooperation and technology transfer between the partners. Joe Locke, regional telecoms analyst with ABN Amro in Hong Kong, said that it would make sense for Unicom to go through with a stake sale.
However, the question is at what price the company's share price has lost nearly one third of its value over the past three months as part of the global selldown of global telecommunications share prices.
At midday on Wednesday, Unicom was up HK$0.150, or 1.32 per cent, at HK$11.50.
Mr Locke said that Unicom shares have never been so cheap. The question is whether Unicom would want to sell at this level.
Moreover, he said the company might decide to postpone any sale until its full-year 2000 results have come out or until nearer to China's entry to the WTO, when there will be greater interest. It might also opt to initially sell only a small stake.
Mr Locke said that if they sell a little nibble like what China Mobile did with Vodafone, it will help raise interest. <<
- Eric - |
