In 3 billion 300 million the Huarun mobile Hongkong swallow intended to obtain 3G license

A foreign investment bank expects the move was intended to obtain Hongkong 3G license

After paying more than HK $3 billion 300 million in real money, China Mobile (0941). HK) was finally completed on the Huarun people (0331). Merger and acquisition (HK). By eating the fourth major telecom operators in Hongkong, the mainland's largest mobile telecom operators will ship into the international market. Yesterday evening, China Mobile announced that the Huarun peoples offer until the end of four pm yesterday, the Huarun acquired a total of 741294601 shares, accounting for as of yesterday afternoon, Huarun peoples shares 99.68%. Next, China will move to acquire all of Huarun's acquisition of shares, and then cancel the listing of the status of the people of Huarun in the stock exchange, privatization.

Borrow ship to sea

Prior to the acquisition of Huarun's people, the internationalization of China's mobile strategy has not yet substantive action, which means that the mainland telecom giant will officially go to sea gold.

In October 23, 2005, China Mobile and Huarun peoples had issued a joint announcement, China Mobile Hongkong company proposed to take voluntary conditional cash offer ", a share price of HK $4.55 acquisition of Huarun telephone all the issued shares, involving funds of HK $3 billion 383 million 600 thousand. The move to the acquisition of financial advisers for gold and Merrill lynch.

The announcement shows that, with Huarun's last trading day (October 3rd) closing price of HK $3.90 compared to the purchase price premium of 16.67%. October 4, 2005, China Mobile (Hongkong) Company and Huarun signed a memorandum of understanding. According to the memorandum at the time, the move will acquire a total of about 66.54% of Huarun shares, the purchase price of HK $4.55 per share, the total amount of approximately HK $2 billion 264 million. However, later moved to propose a comprehensive acquisition proposal. After the purchase, involving funds will reach HK $3 billion 384 million.

Market analysts believe that the transaction is completed, mainly driven by the two sides behind the parent company. China Mobile group, Huarun group is a subsidiary of Huarun group, the two groups are central enterprises. Therefore, the mobile show through investment in Hongkong, will enter the international market, Huarun will move it.

As rooted in Hongkong's central enterprises, Huarun group's total assets of more than HK $100 billion. Currently, its main business is the production of consumer goods, real estate and infrastructure in three areas, excluding telecommunications. The transfer of Huarun's people, is conducive to Huarun group focused on the main business, it is also a good thing.

Intended 3G

The intention of the move of the strategy, UBS, Citigroup and other American Investment Bank predicted that its main purpose should be "made in Hongkong 3G license to compromise".

Huarun is ranked fourth in Hongkong mobile communications market, just 2G operators, no 3G license. However, Hong Kong University Science & Technology, Dr. Xu Yan pointed out that, according to the technical neutrality of Hongkong telecom market, 2G operators can also carry out a small part of the 3G business, but limited capacity. In accordance with the existing spectrum of mobile, Huarun can fully through the platform for the first 3G roaming business.

Major impact

Hongkong industry insiders pointed out that China's mobile strategy aims to integrate the mobile communications market. Hongkong's 6 largest mobile operator's roaming revenue comes from mobile users to Hongkong. After the completion of the acquisition, mobile change and customer roaming agreements, will go to Hongkong mobile customers roaming service all over to Huarun or its peoples, as the preferred roaming service provider, will have a significant impact on Hongkong and other mobile operators. Moreover, if the move in the mainland to sell Huarun's prepaid cards, the impact will be more serious.

Galaxy Securities senior analyst Wang Guoping believes that the growth rate of China's mobile communications market has slowed down, mobile operators must consider the timely entry into the international market, through mergers and acquisitions to expand the growth potential. Telecommunications Research Institute of the Ministry of information industry consultant Qin Rui also said that Hongkong can become the mainland operators going out springboard. At present, the domestic operators to face foreign trade friction, exchange rate and other issues, through the acquisition of Hongkong telecom operators to enter the overseas market is a good choice.

A well-known international investment bank analysts said the move is likely to acquire a Hongkong operator, such as CSL or digital pass. If the move to buy CSL, and then combined with Huarun's people, will become the largest mobile operator in Hongkong.