State-owned China Telecom is looking for private investors to finance some of its projects including online payments and social networking.
Wang Xiaochu, chairman of the Hong Kong-listed company, told China Daily that these investments could take the…
State-owned China Telecom is looking for private investors to finance some of its projects including online payments and social networking.
Wang Xiaochu, chairman of the Hong Kong-listed company, told China Daily that these investments could take the shape of joint ventures and acquisitions.
He added that “smaller but more capable shareholders” could even hold operating rights in China Telecom although the state would continue to own the majority of shares.
In recent years, the Chinese government has been slowly loosening its grip on telcos through various measures in order to boost the sector alongside other industries including utilities, banking, oil and railway.
China Telecom, but also its larger state-controlled rivals China Mobile and China Unicom, have been able to receive private capital to provide certain services and the regulator recently agreed for the market to determine telecommunications charges, China Daily indicated.
A few months ago, the government green-lit the issuance of MVNO licences to private companies for the provision of mobile services. Michelle Chan, a TMT partner at Herbert Smith Freehills, told TelecomFinance at the time that these new MVNOs would likely alter market dynamics in the telecoms industry.
Separately, the three operators recently confirmed they were in talks to set up a joint tower company in the country in order to lower capex.
It would be a first for China, which does not have an independent tower company so far.
If the plans go through, the JV would help accelerate China Unicom’s and China Telecom’s 4G network rollout, Nomura analyst Leping Huang said recently. He also expects the towerco to be positive for telecoms vendors “as it could push the operators to allocate a higher proportion of capex to telecom equipment”.
China Mobile is the world’s largest operator in terms of subscribers with over 775 million customers. China Unicom and China Telecom respectively have 285 million and 185 million subscribers.
