Telefónica Buys Stake in China Netcom
From Financial Times: Telefónica buys stake in China Netcom
"Telefónica of Spain yesterday broke into China's state-run telecommunications sector by agreeing to pay €240m (US$290m) for a 3 per cent stake in China Netcom, the Hong Kong and New York-listed operator."
"The Spanish company, the world's third-biggest telecoms group by market value, said it had signed a broad strategic alliance with Netcom, China's second-largest fixed-line operator.
It said it hoped eventually to lift its stake to the maximum 5 per cent and qualify for a seat on the board."
"China Netcom is widely seen as weaker than China Telecom, its larger rival, as it mainly operates in the less affluent northern regions. However, it is confident of being awarded a third-generation mobile phone licence, which should shore up its long-term growth.
Amid growing competition and China's maturing fixed-line market, Netcom has been relying on broadband and a limited wireless service as its key growth engines. It is also dipping its toes into broadband television."