Chinese Telcos: Unicom/Telecom merger potential. Downgrade China Tower to Reduce (TP:HKD1, -15%)
Newsflow today suggests that China is considering the merger of Unicom and Telecom after considerable speculation in the past. We have consistently been of the view that a merger would make sense in that it would help level the playing field (a bigger competitor to China Mobile), improve returns (a key agenda for SOE reform) and drive 5G network scale faster than what would have been possible without any merger.
China Telecom is a full services integrated information service operator and wireline telecommunications and broadband services provider in the People's Republic of China. Co. offers wireline and mobile telecommunications services including wireline voice, mobile voice, internet, managed data and leased line, value-added telecommunications services, integrated information application services and other related services. As of Dec 31 2010, Co. had wireline access lines in service of approximately 175 million, wireline broadband subscribers of approximately 63 million and mobile subscribers of approximately 90 million.
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New Street Research is an independent, partner-owned, research firm specialising in equity and debt research. Our equity research embraces the following sectors:
- Pan European Telecom Services and Cable
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- Global Emerging Market Telecoms
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