To say the least, Richard Li Tzar-kai defies conventional wisdom when it comes to telecommunications strategy. The Pacific Century CyberWorks chairman drew relieved reviews for the firm's latest debt-reducing asset sale, but investors were left scratching their heads about future plans.
CyberWorks was always going to be a debt-repayment machine after its audacious 2000 leveraged buyout of Cable & Wireless HKT, but apparently half-formed plans to potentially re-enter the mobile sector 18 months hence while planning unspecified future asset sales do not make for clarity.
What kind of company eventually emerges from the once globally ambitious CyberWorks may not be entirely up to Mr Li, with markets ravaging heavily indebted players. For now it remains a rag-tag telecoms and property conglomerate.
Analysts reckon the US$614 million sale price for its remaining 40 per cent interest in Regional Wireless, which holds SAR mobile operator CSL, was conducted at fair value, but the deal did little to abate investor blues.
Against the backdrop of accounting scandals and a global capacity glut, there is little appetite for telecoms stocks. CyberWorks may be defensively positioned due to its dominance in the SAR home line rental market but its share price remains under pressure, closing yesterday at HK$1.82.
Attention remains focused on the industry's multiplying negatives. Poor performance of early third generation (3G) network offerings, lower-than-hyped transmission speeds, a lack of killer content and competing wireless broadband services dog its prospects.
