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China Netcom ready to issue IPO
By Chen Zhiming (China Daily)
Updated: 2004-10-22 08:38
China Network Communications Group Corp (China Netcom), the country's
second-largest fixed-line operator, will kick off its initial public offering
(IPO) in Hong Kong on November 4 through 9, beginning its penetration into the
capital market.
According to the company's prospectus, it is to issue 94.14 million shares in
New York in the form of ADRs (American depositary receipts) and 10.46 million
shares in Hong Kong.
Sources close to China Netcom said the company will begin stock promotion
activities on Wednesday.
Roadshows will soon be made in Asia, North America and Europe.
Investors will be able to trade China Netcom's shares in New York on November
16 and in Hong Kong on November 17.
China Netcom is the only telecom operator among the country's major four
carriers that has not been listed in the stock market.
The company is expected to raise about US$1 billion to US$1.5 billion via
listing.
"About 50 per cent of raised funds will be used to construct new telecom
networks to enhance our competitiveness," the company said in a statement.
The first batch to be listed will include the assets from the company's
subsidiaries including Beijing, Tianjin, Shandong, Hebei, Henan, Liaoning,
Shanghai, Guangdong, Netcom International and Asian Netcom.
Zeng Jianqiu, a professor with Beijing University of Post and
Telecommunications, believes after years of adjustment and integration, China
Netcom is ready for listing.
"China Netcom is now very competitive in the market given the size of the
Chinese market and its increasing market share," the professor said.
So far, China Netcom has a total asset of 240 billion yuan (US$28.9 billion).
By the end of June, it recruited more than 77.6 million fixed-line
subscribers and 4.2 million broadband users.
"What investors look to is China Netcom's business performance, and I believe
after years of adjustment, China Netcom is moving on quickly," he said. He
believes China Netcom is very promising in many of its businesses such as
broadband, Xiaolingtong, and other telecom value-added services.
Some analysts believe there are few different selling points for China Netcom
in comparison to other telecom operators.
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