Among all the Chinese state-owned companies listed in Hong Kong, the telecom sector have exposed most to the capital market. especially these days.
China Mobile: acquistions overseas, such as buying into Millicom and Pakistian Telecom.
Comment: Good way to expand, but the operator's lack of experience in overseas market may trigger the crisis in the management of new merged companies.
China Unicom: South Korea Telecom is in talks to buy 10 percent stake of China Unicom, possibly in the form of buying new issue covertible bonds.
Comment: Will the deal help with the performance of China Unicom? I wonder. 10 percent stake will not certainly improve the service as well as expanding the market share.
China Netcom: Australia-based Macquarie Bank may spend 40 billion HK dollars to buy the telecom assets of PCCW in which China Netcom has a 20 percent stake.
Comment: I guess PCCW is doing this to press on China Netcom, the second largest shareholder, to join the bid, but China Netcom may not want to do this, especially after Edward Tian suning, famous for his skill on capital market, left the company.
China Telecom: nothing has happened yet, as its performance isn't good these days. But I believe Wang Xiaochu, the former chairman of China Mobile, will do something soon.
One of my friends writing a "Gossip" finance column once did research on the places where state-owned companies held the annual group meeting. He found that all four telecom companies moved the place to Hong Kong from Beijing, which is unlike from giant companies. In my view, holding the AGM in HK at lease shows the company wish to expose to the capital market.
Now is the telecom sector, my next bet is the banking sector, active in M&A market in the next ten years.