Hong Kong New World Extends Exclusive Merger Talks With Telstra

HONG KONG -(Dow Jones)- New World Development Co. said Friday it has agreed to extend for two weeks exclusive talks with Australia's Telstra Crop. to finalize a deal to merge their Hong Kong-based mobile phone service providers.

The Hong Kong-listed property developer said the two companies have set Dec. 16 as a new deadline for exclusive talks on the deal, which aims to merge New World Mobile Holdings Ltd. with Telstra's Hong Kong unit CSL.

The companies signed a nonbinding memorandum of understanding last month under which Telstra would own 76.4% of equity and New World Mobile would own the remaining 23.6% of the merged operation, which would become the city's largest wireless operator by subscribers.

Melbourne-based Telstra acquired CSL from Hong Kong's main fixed-line operator PCCW Ltd. for US$2.2 billion in phases over 2000 and 2001.

Since the proposed merger was announced on Nov. 14, New World Development shares have soared 16%, while New World Mobile's shares have fallen 44%.

-By Jeffrey Ng, Dow Jones Newswires; 852-2802-7002; jeffrey.ng@dowjones.com

-Edited by David Riordan

(END) Dow Jones Newswires "

Posted to the site on 2nd December 2005