The privatization of Chunghwa Telecom (中華電信) began in earnest yesterday with the commencement of bidding by individuals and institutional investors in an auction-style sale of 3 percent of the government's shares in the utility. But according to analysts and executives from China Trust Commercial Bank (中國信託商業銀行), which is managing the domestic segment of the privatization plan, bidding yesterday was probably light, with the majority of the bids expected on the last days of the auction which ends Saturday.
An executive from China Trust who requested anonymity, said that no bidding figures would be available until early today, but he didn't expect the action to heat up until tomorrow or Saturday.
"Bidding today was likely light as most institutional investors will wait until they can determine from early bidding what the price will be around," he said.
If they bid early, they risk ending up with overpriced shares, bid to low and you might miss out, he added, as those who bid higher will have a better chance of winning.
These sentiments were echoed by Earnest Chiang (
Grand Pacific, "won't rush in to bid ... our company will make a decision Friday after observing the progress of the first two days of bidding."
"We won't move until it becomes clear at what price the shares are selling," he said. Adding that his firm's "bid for shares should fall under NT$120."
Other market watchers however have said that the price for Chunghwa stock could rise to NT$135, which would value the company at US$41.83 billion, making it Asia's fourth-largest telecoms company.
The 3 percent auction is the first part of a plan to sell off 21 percent of the government's shares in Chunghwa before the end of the year. The next phase of the plan will be a 13 percent offering to the public, which will be held in September.
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