Datang Telecom in line for restructuring

Shanghai-listed Datang Telecom Technology yesterday announced that its controlling shareholder, China Academy Telecommunications Technology, will inject a 36.6 per cent stake in the company into a new holding unit.

Datang Telecom, a provider of telecommuications equipment, software development and microelectronics products, said the new unit had a registered capital of 100 million yuan.

The transfer is seen as a move to make way for China Academy to inject its other mobile technology businesses, which own patents for the homegrown TD-SCDMA standard for third-generation mobile phone, into Datang Telecom.

China Academy's injection would include its mobile arm, Datang Mobile, in exchange for money to develop TD-SCDMA equipment business, market watchers said.

'The restructuring of Datang Telecom and Datang Mobile follows the government direction in consolidating state-owned enterprises, but such restructuring still has uncertainties,' China International Capital Corp said in a report yesterday.

Datang Telecom last week said that China Academy had no plans to carry out a significant business and asset restructuring over the next six months. It also said China Academy did not intend to list all the assets through Datang Telecom.