Others News
- Vodafone sees China growth
Date: 20-Nov-2007 Sources: (Shenzhen Daily)
VODAFONE is seeking to increase its presence in China through a government-led restructuring of the country's telecommunications industry.
Arun Sarin, Vodafone's chief executive, told the U.K.-based Financial Times that the U.K. mobile phone group's US$13 billion stake in China Mobile, China's leading wireless operator, was a 'kitty?that could be used to take advantage of opportunities.
The Chinese Government is planning a restructuring of the country's telecom sector that may reduce China Mobile's dominance of the world's largest mobile market.
The most widely discussed possibility would involve the break-up of China Unicom, China Mobile's smaller rival, and the division of its mobile assets between China Telecom and China Netcom, the country's two fixed-line operators.
Industry analysts said transferring Unicom's wireless assets to China Telecom and China Netcom could boost competition and reduce duplication of investment when China adopts third-generation mobile technology.
Such changes might also give Vodafone the chance to swap its 3 percent stake in China Mobile for a bigger minority shareholding in another Chinese mobile company, although Sarin said it was too early to tell what form the industry revamp could take.
He highlighted the growth opportunities in China, given only 35 percent of the population has a mobile phone.
Sarin said restructuring might happen next year, adding: 'From our shareholders' point of view, China is 35 percent penetrated, we have got a long way to go. Would we like to participate in a bigger way? Of course we would like to participate in a bigger way.'
He also highlighted how Vodafone's 3 percent stake in China Mobile, bought for US$3 billion, was now worth US$13 billion.
'We have US$13 billion in China. That is a nice kitty [or] endowment to either stay where we are, or take wherever we want it,'he said.
Asked if he could see Vodafone selling out of China Mobile and taking a large minority stake in one of the fixed-line companies, such as China Netcom - if it gains a mobile license - Sarin replied: 'Frankly, whatever the Chinese Government wants us to do, so long as it is responsible and right, we will do.'
He stressed Vodafone did not expect to obtain a majority stake in a Chinese wireless business, because of government control.
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