Taiwan's Chunghwa Telecom Buys 21.1% Of Digital Content Firm
TAIPEI -(Dow Jones)- Taiwan's Chunghwa Telecom said Monday it acquired a 21.1% stake in local digital content provider Elta Technology by buying 2.59 million shares in the firm in a rights issue. It didn't say how much it paid for the stake.
Following the rights issue, Chunghwa Telecom has become Elta Technology's largest shareholder, said Elta Technology Chairwoman Sally Chen.
Chunghwa Telecom, Taiwan's sole integrated telecom company and its largest telecom firm by revenue, will also gain a seat on Elta Technology's board, Chunghwa Telecom said in a statement Monday.
Elta Technology is a digital content aggregator, providing movies in digital format for Chunghwa Telecom's Hinet Web site and Internet television services, Chunghwa Telecom said in the statement.
"Digital content, both for third-generation (mobile phones) and multimedia on demand (Internet TV) is very important for us," said Chunghwa Telecom Chief Financial Officer Joseph Shieh.
Elta Technology Vice President Peter Cheng said the two companies have been cooperating in digital content since 1998.
Through the rights issue, "it is important for us to secure this distribution channel (for digital movies) because of the expected growth in the MOD service," Cheng said.
Chunghwa Telecom said earlier it is targeting 580,000 users of its Internet TV services this year, up from 270,000 now, and plans to sign an additional 1.4 million third-generation mobile users this year. At the end of February, the company had 1.13 million 3G users.
-By Alex Pevzner, Dow Jones Newswires; 8862-2502-2557; alex.pevzner@dowjones.com
(END) Dow Jones Newswires"
Posted to the site on 9th April 2007
