Wednesday, August 15, 2007

How much China Unicom worths?

8/15/2007, The most recent UBS report said China Unicom wanted to sell their CDMA network to China Telecom on the price of 14.6billion RMB. The price is higher than the 8 to 8.5billion USD UBS estimated before. UBS said the price had been the main obstacle behind the deal.

But according to another local securities analyst, China Unicom worths at least 100billion RMB, that is more than 12billion RMB. In the past years, Unicom has invested nearly 100billion RMB for their CDMA network. Considering 40million CDMA subscribers, the 14.6billion USD price isn't very high.

UBS always is the most active supporter on selling Unicom's CDMA network, although Unicom has denied several times. This time again, Unicom denied they would sell their CDMA network. I believe UBS must have their insider in Unicom, so they can again and again tell the public Unicom will sell CDMA network. But the reorganization of the carriers in China is more political than a financial analyst can predict. For what reason China Unicom must sell their CDMA network, I don't know.

Except UBS, not everyone believes there must be a reorganization ahead this year.

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