Biz / Tech

China Unicom surges 10 percent on US$12 billion investment

China's second-biggest telecom operator attracts funds from Alibaba, Baidu and Tencent

Shanghai-listed China Unicom surged by the 10 percent daily cap today after releasing the final details of an agreement to attract 78 billion yuan (US$11.5 billion) from investors, including Internet giants, industry leaders and special funds.

The new strategic investors, including Baidu, Alibaba, Tencent and JD.com, will take a 35.2 percent stake in China Unicom while the state-owned China Unicom Group will hold 36.7 percent.

The deal sent Shanghai-listed China Unicom to close at 8.22 yuan today. Meanwhile, its Hong Kong-listed shares jumped 3.52 percent today.

Electronics retailing titan Suning, software giant Yonyou Network and network service provider Wangsu Science & Technology have also invested in China Unicom, the country's second-biggest mobile carrier.

The deal marks the largest capital raising in the Asia-Pacific region since 2010. It will also be the biggest deal in recent years under China’s mixed-ownership reforms, which seek to integrate and merge state-owned assets with private capital, industry insiders said.

“The spotlight of the deal is not only the capital, but new opportunities, new business operation and new structure of China Unicom,” said Guosen Securities in a report.?

Private investment is expected to contribute more to invigorate China's economy, the National Development and Reform Commission, the country's top economic planner, said.

The deal, which has been approved by the China Securities Regulatory Commission, comes after China Unicom said last Wednesday it would raise 78 billion yuan from dozen of investors. But it later deleted the related statement for "un-confirmed issues”.

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