China Telecom Acquires Provincial Networks From Parent.China Telecom Corp Ltd, the largest fixed-line operator in mainland China, has announced it is purchasing provincial phone networks from its parent company China Telecom. This follows a similar purchase last year. Last October, China Telecom Corp paid its parent $5.6bn in cash for six provincial networks, upping its coverage to 10 provinces and subscriber numbers to 100 million. With the new purchases, China Telecom Corp will pay its state-owned parent CNY CNY In currencies, this is the abbreviation for the China Renminbi. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. 27.8bn ($3.35bn) for 10 more provincial networks. CNY 3.84bn ($1bn) will be paid in cash upfront, while the remainder will be paid 10 years after the deal is completed. In addition to this, it will also assume CNY 40bn ($4.83bn) of debt owed by the networks. The new networks are in the provinces of Hubei, Hunan, Hainan, Guizhou, Yunnan, Shaanxi, Gansu, Qinghai, Ningxia Hui Autonomous Region Ningxia Hui Autonomous Region (nĭng`shyä` hwē), autonomous region (1994 est. pop. 5,030,000), c.25,600 sq mi (66,321 sq km), N China. The capital is Yinchuan. , and Xinjiang Uygur Xin·jiang Uy·gur also Sin·kiang Ui·ghur or Sin·kiang Ui·gur An autonomous region of extreme western China. It came under Chinese control in the 16th century and was the site of a conflict between China and the Soviet Union in 1969. Autonomous Region. These 10 provincial networks are mainly in the poorer regions of China and have a total of 42.9 million subscribers, commanding 95.9% of the market share in the 10 provinces. The business includes fixed-line telephone, internet and managed data, and leased line A private communications channel leased from a common carrier. Most digital lines require four wires (two pairs) for full-duplex transmission. (communications, networking) leased line services. In 2003 they recorded sales of CNY 33.1bn ($3.99bn), but posted net losses of CNY 10.8bn ($1.30bn) after they were hit with a CNY 4.8bn ($580m) write-off Write-Off A reduction in the value of an asset or earnings by the amount of an expense or loss. Companies are able to write off certain expenses that are required to run the business, or have been incurred in the operation of the business and detract from retained revenues. . With the acquisition, the geographic coverage of the company's operations in China will expand to 20 provinces and its subscribers will exceed 160 million. Such acquisitions have become common practice for China's three largest telecoms companies: China Telecom, China Mobile and China Unicom China Unicom, full name China United Telecommunications Corporation, 中国联通, HKSE: 0762 NYSE: CHU, is a telecommunication operator in the People's Republic of China. 52. . Each of these made initial public offerings of their parents' most profitable provincial networks, and have purchased the less profitable networks from their parent companies. Last month, China Telecom Corp posted a better-than-expected 2003 net profit of CNY 24.69bn ($3.2bn), up 153% from the previous year, as the carrier benefited from solid growth in its wireless and broadband broadband Term describing the radiation from a source that produces a broad, continuous spectrum of frequencies (contrasted with a laser, which produces a single frequency or very narrow range of frequencies). businesses. Revenue grew 8.1% to CNY 118.5bn ($14.31bn). In February, China Telecom Corp announced plans to issue shares worth roughly $3.03bn to fund the acquisition of the 10 provincial networks. |
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