China Unicom Parent Denies China Telecom Merger Talks
BEIJING -(Dow Jones)- China United Telecommunications (parent of China Unicom) said Thursday it hasn't considered a merger with China Telecom nor is it in talks about such a deal.
Shanghai-listed China United Telecommunications indirectly holds a stake of about 63% in Hong Kong-listed China Unicom, which operates CDMA and GSM networks in China through wholly owned unit China Unicom Corp.
The denial came after the Financial Times, citing an unnamed source at China Telecom, reported Wednesday on its Web site that China Telecom "could possibly" merge with China Unicom.
Such a report is untrue, said Board Secretary Lao Jianhua.
He also said China United Telecommunications hasn't received any notification from the state-asset regulator or the State Council, the country's Cabinet, about such a plan.
The Chinese government has said it is considering a restructuring of the telecommunications industry to promote competition.
"The problem is very complicated and there are a lot of different opinions," Xi Guohua, vice minister at the Ministry of Information Industry, which regulates the telecom sector, said in April.
Analysts have said various government agencies, including the MII and the State-owned Assets Supervision and Administration Commission, will likely be involved in designing a new industry structure.
China Unicom trails China Mobile Ltd. in terms of customer base in China's mobile sector, while the country's two fixed-line carriers - China Telecom and China Netcom Group Corp. - are missing out on rapid mobile-user growth and are facing slowing fixed-line user growth.
China Telecom couldn't immediately be reached for comment.
-By Terence Poon; Dow Jones Newswires; 8610 6588 5848; terence.poon@dowjones.com
(END) Dow Jones Newswires
Posted to the site on 16th August 2007
