Subject category:
Finance, Accounting and Control
Published by:
Asia Case Research Centre, The University of Hong Kong
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Abstract
When China Telecom (Hong Kong) (CTHK) went public in October 1997 it was Hong Kong''s largest ever initial public offer (IPO). Amidst a turbulent economic environment, CTHK''s listing was oversubscribed by an impressive thirty times and raised almost US$4 billion. The listing of CTHK was ''sold'' to the international community as a China ''telecoms play'' and the start of China''s privatisation program. But neither of these positions was accurate. Despite being in the midst of one of the world''s largest telecommunications programs, China retained a complete ban on foreign direct investment in the telecom services sector. Foreigners were allowed to neither own or operate public networks of any kind in China. So what then had they bought with US$4 billion of investment? How had China Telecom managed to sell a minority stake in one of its operational companies without actually selling any control?
Subject category:
Finance, Accounting and Control
Published by:
Asia Case Research Centre, The University of Hong Kong
Length: 4 pages
Data source: Published sources
About
Abstract
When China Telecom (Hong Kong) (CTHK) went public in October 1997 it was Hong Kong''s largest ever initial public offer (IPO). Amidst a turbulent economic environment, CTHK''s listing was oversubscribed by an impressive thirty times and raised almost US$4 billion. The listing of CTHK was ''sold'' to the international community as a China ''telecoms play'' and the start of China''s privatisation program. But neither of these positions was accurate. Despite being in the midst of one of the world''s largest telecommunications programs, China retained a complete ban on foreign direct investment in the telecom services sector. Foreigners were allowed to neither own or operate public networks of any kind in China. So what then had they bought with US$4 billion of investment? How had China Telecom managed to sell a minority stake in one of its operational companies without actually selling any control?
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Subject category:
Finance, Accounting and Control
Published by:
Asia Case Research Centre, The University of Hong Kong
Length: 4 pages
Data source: Published sources