Tue, Aug 29, 2006 - Page 12 News List

Chunghwa Telecom reveals building plans

By Lisa Wang  /  STAFF REPORTER

Chunghwa Telecom Co (中華電信), Taiwan's biggest phone company, plans to invest in the booming housing and hotel industries as part of its broader project to revitalize underused land to fuel revenue growth a company executive said yesterday.

The telecom operator's announcement came about a month ahead of a new large-scale sale of around 800 million common shares primarily in the US. After the sale, the government's holding will drop to 34 percent from the current 42 percent.

Chunghwa Telecom said it planned to build a hotel in the popular sight-seeing resort of Kenting in southern Taiwan and an apartment building in the suburbs of Taipei in partnership with local hotel operator Leader Hotel Consultant Co (立德旅館) and construction firm Kindom Construction Co (冠德建設).

"These projects will boost Chunghwa Telecom's revenues and profits after construction is completed in 2009," Chugnhwa Telecom Chairman Hochen Tan (賀陳旦) said in a statement.

The revitalization programs would add a combined total of approximately NT$1 billion (US$30.38 million) to the telecom company's revenue in 2009, while Chunghwa Telecom would spend less than NT$100 million without calculating the 1,756 ping of land it offered, Hochen told reporters yesterday.

Chunghwa Telecom's projected revenues for this year would rise less than 0.5 percent to NT$184.2 billion from NT$183.38 billion last year, while net income would drop 0.7 percent to NT$44.24 billion from NT$47.65 billion during the same period.

Chunghwa Telecom is set to sign agreements with the companies within a month after details are finalized. The 54-room hotel is slated to start operation in 2008 one year earlier than the completion of the apartment building comprising 240 units. Leader Hotel will operate the hotel for an initial period of 20 years following its completion.

Chunghwa Telecom planned to unveil two more housing development projects in the next quarter involving 4,300 pings of land in northern and central Taiwan and two more next year in partnership with local construction firms

The phone company owns more than 400 hectares of idle land around the nation with one tenth of it located in downtown districts or sight-seeing areas.

Last year, Chunghwa Telecom generated NT$270 million in revenue by developing its underused real estate.

The company said the figure would be even higher this year without giving a specific forecast.

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