The first time this happened was when Pacific Century Cyber Works (PCCW), controlled by Richard Li, acquired Hong Kong Telecom. But that 2000 adventure did not end well. PCCW’s stock price tanked.
Seventeen years later, things are different. The real story may not be a state-sanctioned infusion of private capital into a 100% state owned infrastructure company, but the first move by firms in the upper layers to take over entities in the infrastructure level.
According to Reuters, Alibaba and Tencent will lead a group of investors, while Chinese search company Baidu pulled out of the funding round.
China Unicom, the second largest mobile operator in the mainland, is listed on the Shanghai exchange.
Sources told Reuters about CNY50 billion would be raised by issuing new shares, while the operator would sell part of its stake to the new investors.
The range of potential investors also includes other major internet firms in China and some state-backed institutions such as China Life Investment, Reuters said.
China Unicom announced in early April its parent company was reviewing its ownership structure in a move which could see it take on private investment.