Red-Chip Bid to Seal Alliance With Big Six Telecom FirmsRed-chip Citic Pacific expects to seal an alliance with one of China's Big Six telecommunications operators this year.Wang Jun, chairman of Citic Pacific parent China International Trust and Investment Corp (Citic Beijing), Friday said the potential partner had yet to be chosen. "We are in discussions with the Ministry of Information Industry which has a say in the matter," he said. The companies had not signed any letter of intent but were confident a deal could be struck this year. Citic Pacific is represented in the planned deal through China Express No 1 Backbone - a 60 per cent-owned subsidiary whose main asset is a nationwide fiber-optic network. The network, which is still under construction, will eventually span 32,000 kilometers, linking most key mainland cities. The remaining stake in the subsidiary is owned equally by Citic Beijing and Citic Pacific chairman Larry Yung Chi-kin. While some analysts have said Internet telephony services provider China Netcom Corp would be a likely partner for Citic Pacific, as they could reap synergies in their fiber-optic networks, China Netcom chief executive Edward Tien last month denied the speculation as "groundless". Sixteen-month-old China Netcom has completed more than 8,000 kilometers of fiber-optic network, which boasts the fastest data transmission speed in all of China's fixed-line networks - 40 gigabits per second. China Unicom and soon-to-be-set-up China Railway Telecom (CRT) - a unit of China's Railway Ministry - are expected to merge their networks within perhaps three years, analysts believe. CRT, a shareholder of China Unicom, has 120,000 kilometers of rail network, of which about 40,000 kilometers already have fiber-optic cover. It will provide fixed-line and data transmission services, making it a credible competitor with China Netcom and fixed-line giant China Telecom. |
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