Taiwan Mobile Co (台灣大哥大) said it planned to acquire Hong Kong-based PCCW Ltd's (電訊盈科) local affiliate the Taiwan Telecommunication Network Services Co (TTN, 台灣電訊), in a deal worth up to NT$1.5 billion (US$45 million).
This may indicate an ambition by the nation's third-largest mobile telecom service operator to tap into the growing Chinese market since TTN provides services such as video-conferencing solutions over satellite and the Internet primarily for companies with operations across the Taiwan Strait.
Last year, Chunghwa Telecom Co (
"To expand our business, the company plans to buy TTN's common shares via a fully-owned subsidiary," Taiwan Mobile said in a filing to the Taiwan Stock Exchange on Wednesday night.
Taiwan Mobile said it planned to offer a maximum of NT$13.843 per share to buy an unspecific number of shares in TTN, which has 108.7 million shares issued in total.
Taiwan Mobile shares declined 0.28 percent to NT$35.5 yesterday on the main bourse, defying the 0.62-percent gain of the benchmark TAIEX index.
PCCW holds around 60 percent of TTN, which was established in 1989, according to the Hong Kong company's Web site.
TTN, the nation's third-biggest Internet service provider, supplies services primarily to financial institutions and large-scale enterprises, including the GRETAI Securities Market (櫃買中心), Taishin International Bank (台新銀行) and Formosa Group (台塑集團), PCCW said on its Web site.
Separately, Taiwan Mobile forecast that earnings would plunge to NT$0.8 per share this year, compared to NT$3.28 a share last year, due to a massive write off of NT$14.7 billion this year.
Pre-tax income would amount NT$4.44 billion this year, the company said in a statement to the Taiwan Stock Exchange on Wednesday. That would represent a drastic decline from NT$16.17 billion in net income last year.
Revenues would grow around 5 percent this year, from NT$47.89 billion last year, it said.
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