HK Legend Confirms It Is In Talks With AOL On Internet JV
11:21, 2001-06-06
HONG KONG (Dow Jones)--China's largest computer maker Legend Holdings Ltd. (H.LHD) confirmed Wednesday it is in talks with American Online Inc. (AOL), the world's biggest Internet service provider, about setting up a Web-related joint venture targeting Chinese consumers.
``The company is in negotiations with American Online, Inc. to explore opportunity for the establishment of an Internet-related services joint venture targeting the consumers in mainland China,' Legend Chairman Liu Chuanzhi said in a statement.
The formal statement followed an Asian Wall Street Journal report Monday that a US$200 million AOL-Legend venture, the U.S. company's first major entry into the Chinese market, is expected to be announced next week in Beijing.
The Journal reported that the two companies each plan to contribute US$100 million to set up a new company to develop interactive services targeted at Chinese consumers, with Legend holding a 52% stake, reflecting China's tight restrictions on foreign ownership in the telecommunications and Internet sectors.
AOL will provide ``interactive technology and know-how' to Legend's flagship portal, www.fm365.com, but won't hold equity in the Web site, the Journal said.
At around 0240 GMT (10:40 p.m. EDT Tuesday), shares of Legend were flat at HK$5.70. It has gained 5.6% since Monday. -By Sonia Tsang, Dow Jones Newswires; 852-2802-7002; sonia.tsang@dowjones.com
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