Unicom refuses to confirm Baidu and investment reports

Unicom refuses to confirm Baidu and investment reports

China Unicom has stated that it is still holding talks with possible investors, after indications emerged that internet firms and Baidu were interested in backing the state-owned operator.

The Chinese internet firms would join Tencent and Alibaba in providing a total investment of CNY85 billion ($12.6 billion) to China Unicom. This follows a review of the operator’s ownership structure after the National Development and Reform Commission granted it permission to take on more private investment in what is being termed a pilot run for mixed ownership reform in China.

Of the CNY85 billion total, Alibaba and Tencent between them have pledged around CNY70 billion, while reports suggest that Baidu will offer CNY10 billion and will provide CNY5 billion – conflicting with previous reports that the search engine firm would not invest at all. State-backed China Life Investment has also been suggested as a potential investor.

However, a China Unicom statement said that the operator was unaware of the sources cited in “media coverage about the investors proposed”, adding that it “had not entered any legally binding documents” with any investors at this time.

The operator’s statement continued: “The concrete implementation plan… including the identities of the investors, pricing term, investment amount and percentage share holdings, still needs to be reported to and approved by the relevant ministries.” Unicom added that it would “perform its information disclosure obligation strictly in accordance with the requirements of the listing rules and other related laws and regulations”.

China’s government is aiming to inject private capital into state-run enterprises without relinquishing control, as part of a drive to improve telecoms infrastructure in the country as well as encouraging greater competition.

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