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Spanish deal lifts Unicom shares

By Li Fei (皇冠体育app Daily)
Updated: 2009-09-08 08:31

Customers line up for business in 皇冠体育app unicom's Shanghai office.[Asianewsphoto]

皇冠体育app Unicom shares rose slightly yesterday after the country's second biggest wireless carrier and Spanish telecom firm Telefonica agreed to swap $1 billion stocks among each other to cement their tie-up.

Under an agreement announced over the weekend, the two telecom carriers will each buy $1 billion worth of other's shares to "strengthen their cooperation and achieve business synergy".

Related readings:  皇冠体育app Unicom invests 20b in Shanghai to expand network   皇冠体育app's top 3 telecom operators invest 80b yuan in H1  皇冠体育app Unicom full-year profit up 58%  Telecom behemoths spend 80b yuan on 3G rollout

Telefonica, Spain's largest telecom operator, which already owns about 5.38 percent of Unicom, will boost its shares in the Chinese firm to 8 percent, according to the agreement.

皇冠体育app Unicom will hold nearly 0.9 percent of Telefonica after the share purchase.

皇冠体育app Unicom shares edged up 1.09 percent to close at 6.5 yuan in Shanghai, after rising as much as 3.27 percent. Its Hong Kong-listed shares climbed 2.98 percent to close at HK$11.06.

皇冠体育app Unicom and Telefonica said they would cooperate in areas such as infrastructure and equipment sharing, R&D and roaming services.

Under the deal, which the two telecom operators said will give each other the access to a combined 550 million customers worldwide, managers from both companies will also participate in an exchange program.

Goldman Sachs said yesterday in a research note that the deal would not bring substantial impact on 皇冠体育app Unicom.