Unicom targets a third of nation's 3G market
China Unicom intends to capture one-third of the mainland 3G mobile telephone market once its merger with China Netcom Group Corp is completed in October, the company says in a circular to shareholders.
'The merged entity is expected to explore existing and newly developed [mid-range] to high-end markets and aims to capture a one-third share of the future 3G market in terms of number of subscribers, increase its business income and enhance its profitability,' the circular said.
The announcement came as Unicom said it would invest 100 billion yuan (HK$113.8 billion) in the next two years on mobile network infrastructure. Beijing will issue 3G mobile licences after the union is completed.
Unicom and China Netcom in June proposed to merge into a new company called China Unicom (Hong Kong) as part of the mainland telecommunications industry restructuring.
The goal of the revamp is to form three full-service operators providing both fixed-line and mobile-phone services.
Unicom's minority shareholders will cast their votes on the merger and other related issues on September 16 while Netcom's minority shareholders will meet the next day.
Under the proposal, each Netcom share would be exchanged for 1.508 Unicom shares.
The last trading day of Netcom's shares and its American depositary securities will be on October 6.
The shares will be finally delisted from the Hong Kong stock exchange on October 15.
After the merger, China Unicom Group will hold a 40.92 per cent stake in the merged entity.
China Netcom Group will hold 29.49 per cent and public shareholders will own 29.59 per cent.
Chang Xiaobing, Unicom chairman and chief executive, will be appointed chairman and chief executive of the merged entity.
Unicom shares slipped 1.35 per cent yesterday to HK$14.60, while Netcom closed 1.81 per cent lower at HK$21.70.
