When wireless infrastructure company China Tower Corporation is listed publicly by early 2017, one network operator is expected to get a bigger boost than others—China Unicom, reports the South China Morning Post. Last October, the Wall Street Journal reported the tower company was formed by the three largest carriers in the country, China Mobile Ltd., China Unicom (Hong Kong) Ltd and China Telecom Corporation transferring their assets to the joint venture. China Telecom was leasing 550,000 towers, or 55 percent of its total, from China Tower according to mobileworldlive. China Mobile leases one million towers, or 30 percent of its total from the state-owned joint venture.
The carriers said the move will enhance network coverage and save on capital expenditure for constructing telecom towers, which hold equipment for their mobile networks, the Journal said.
This is also good news for the fledgling network operator, who trails widely in number of subscribers behind China Telecom and China Mobile.
Bernstein research firm predicts large gains in Unicom’s value per share. For instance, with a 215 billion yuan (US $31B) valuation for China Tower, Unicom would see a 28 percent rise in its value per share, compared to just 20 percent for China Telecom and 5 percent for China Mobile.
“Any higher valuation of the tower company would have a bigger impact on Unicom’s lower overall market capitalization,” said Chris Lane, a senior researcher at Bernstein.
Indeed, Unicom’s market capitalization was a mere HK $232.29 (US $33) as of Friday, reports the South China Morning Post, compared to HK $1.71 (US $.25) for China Mobile, the largest network operator on the globe. The upcoming listing of China Tower Corp. could reverse these negative trends for China Unicom.
December 12, 2016
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