China Telecom looks to raise up to US$8.4 billion in Shanghai to fund 5G network expansion, innovative projects

Name: Chinese engineers from Huawei, China Mobile build world’s highest 5G base station on Mount Everest
Uploaded: 2021-03-17T12:30:22.000Z
Duration: 1 min 36 s
Description: Chinese engineers from Huawei, China Mobile build world’s highest 5G base station on Mount Everest

The mainland’s largest fixed-line network operator plans to sell 12.09 billion shares and has an overallotment option for another 181.35 million shares

The company plans to use 11.4 billion yuan of the share sale proceeds to fund its 5G development

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A motorist wearing a protective mask goes past a China Telecom store in Shanghai. Photo: Bloomberg

Daniel Ren

Published: 8:30pm, 17 Mar 2021Updated: 8:30pm, 17 Mar 2021

China Telecom, the country’s largest fixed-line network operator, is looking to raise up to 54.4 billion yuan (US$8.4 billion) from a share sale on the Shanghai Stock Exchange, following its delisting by the New York Stock Exchange under a Trump administration executive order.

While China Telecom did not disclose the price range for the yuan-denominated A shares, it said in an exchange filing on Wednesday that it plans to sell 12.09 billion shares. This works out to 4.5 yuan a share, nearly twice the price of its Hong Kong-listed counterpart.

Its Hong Kong-listed shares slipped 0.4 per cent to HK$2.64 on Wednesday.

“The telecoms giant will be greeted with a warm welcome at home,” said Ivan Li, a fund manager with Shanghai Shiva Investment. “Mainland investors are used to higher price-to-earnings multiples than those in Hong Kong.”

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Chinese engineers from Huawei, China Mobile build world’s highest 5G base station on Mount Everest

China Telecom’s share sale in Shanghai comes months after the NYSE suspended trading and delisted the company’s American depositary shares (ADS), along with those of industry peers China Mobile and China Unicom, to comply with a November 2020 executive order by former US President Donald Trump that bars Americans from trading in companies with ties to the mainland’s military.

The Trump administration aimed to limit access by Chinese companies to US stock markets and technology as trade and tech dispute between the world’s two largest economies escalated.

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