China Unicom, the country's third-largest telecommunications player, has agreed to raise 78 billion yuan ($11.7bn) in private capital from a number of China’s leading tech companies including the BAT trio, Baidu, Alibaba, and Tencent, as part of a mixed-ownership reform plan proposed by the Chinese government.
China Unicom is the first major state-owned enterprise to announce the mixed-ownership reform plan.
The new investors will jointly hold 35 percent of shares in the company’s Shanghai-listed parent unit China Unicom group, reducing the stake held by Unicom in the unit to 37 percent from 63 percent.
The investors will subscribe to about 9 billion shares in the company and purchase 1.9 billion new shares at a price of 6.83 yuan per share. Tencent will own a 5.2% stake in China Unicom, followed by Baidu with 3.3%, JD.com with 2.4%, and Alibaba with 2%. China Life Insurance will be the largest investor, with a 10.2% stake.
The Hong Kong-listed mobile operator said the funds would be used to help pay for the development of a next-generation cellular and data network, as it expects to further optimize its corporate governance structure.
