Telecom-Consolidation Rumor In China Fails to Stir Investors
The rumor is explosive: China is considering paring its telecommunications industry, the world's fastest growing, in a blockbuster set of megadeals. A decade-long drive for competition and diversity, a hallmark in the broader reshaping of China's economy, would come to an end.
Yet investors in the three Chinese telecom giants that are traded publicly simply shrugged.
Shares in the listed affiliates of China Telecommunications Corp., China Mobile Communications Corp. and China United Communications Corp., which trade in Hong Kong and New York, ended the week little changed. On the Hong Kong Stock Exchange, China Telecom finished the week down 1.8%, China Mobile fell 1.7% and China Unicom rose 4%.
Welcome to the through-the-looking-glass world of investing in China. Many investors didn't believe the rumors, floated in Chinese newspapers last week, that government officials were studying ways to radically consolidate the telecom industry. Even if they did, it wasn't clear what action they should take without more details about the plan.
Yet the episode was a stark reminder that, for all the steps China has taken toward developing free-market-style corporate ownership, companies still are controlled by the state. Investors in many of China's biggest companies remain powerless minorities, their stakes dwarfed by the Chinese government.
Investors in the Hong Kong shares and American depositary receipts of the Chinese telecom companies are buying "a proxy to China" that behaves like a utility, returning steady, sizable profits, said Francis Cheung, telecom-industry analyst at CLSA Asia Pacific in Hong Kong. While that is attractive to many investors, "there are potential shocks down the road as the government adjusts the industry's structure," he said.
At issue is whether the industry's structure of four major national carriers and two smaller ones is too diffuse to afford so-called third generation, or 3G, network equipment, especially mobile systems that permit the high-speed exchange of data and two-way video calls. The remedies that surfaced last week, at first blush, seem far-fetched.
Officials at the State Owned Assets Supervision and Administration Commission, which oversees major state-run companies including the telecom concerns, are batting around the idea of merging the four largest operators into two entities or merging all six telecom carriers into three companies.
In the 4-to-2 scenario, the giant fixed-line carriers would unite with the large mobile operators. China Telecom, the dominant wire-line carrier, would merge with China Unicom, the No. 2 mobile operator. China Netcom Corp., the No. 2 fixed-line carrier, would unite with China Mobile, the leading Chinese mobile carrier that is also the world's largest.
In the 6-to-3 scheme, big companies would unite with smaller ones. China Telecom would pair with China Railcom Co., a smaller service provider whose assets are along the country's rail right-of-ways; China Mobile would unite with China Satcom Co., responsible for the country's satellite systems; and China Unicom would unite with China Netcom.
Either strategy would reverse the government's decade-long effort to diversify China's telecom industry. Beginning with the creation of China Unicom in 1995 and climaxing with the breakup of China Telecom in 2002, that effort made China's telecom market grow to around 400 million subscribers from fewer than 20 million a decade ago.
But the commission appears to possess a limited ability to carry out either consolidation idea. Another major agency, the Ministry of Information Industry, regulates the telecom industry, setting rates and making other policy decisions. Chen Jinqiao, director of the Institute of Telecommunication Policy Research Department of the China Academy of Telecommunication Research, which is affiliated with the ministry, said the merger idea was just a topic of "chatting" among a small number of officials and experts.
Representatives of the publicly traded telecom companies said they hadn't been notified by the government of such plans. Friday, following several days of reports about merger ideas and relative inactivity in the market, a spokesman for China Mobile said investors didn't believe the rumors.
Still, even as analysts played down the likelihood of the merger rumors, they were forced to take them seriously, quickly producing research notes assessing the possible effect of consolidation. Rohit Sobti, an analyst at Citigroup Smith Barney, wrote that the technical challenges of putting the carriers together are "daunting" and that the companies would become "uninvestable for the 18-24 months following the mergers."
Alistair Scott, an analyst at Merrill Lynch & Co., noted the 4-to-2 plan would give China's telecom industry the same shape as the U.S. sector, where regional fixed-line carriers own nationwide mobile operations. But he wrote: "As a general rule, we would suggest China may not necessarily be better off importing the very evident problems of the U.S. telecom sector."
CLSA's Mr. Cheung said there is no rush for China to address 3G costs because the technology is still new and unprofitable for companies such as Hong Kong's Hutchison Whampoa Ltd., which are implementing it.
"China came to 2G very late and they benefited from the economy of scale in the rest of the world and got cheap equipment," he said. "If they start 3G today, they would drive the economy of scale for the rest of the world. At this point, I don't think it's a very compelling idea to them."
市场对中国电信业整合传言置若罔闻
一个爆炸性的消息在市场中散播开来：中国正考虑通过一系列大宗交易将全球发展最迅速的电信产业的规模进行缩减。作为中国经济广泛转型一大特色的电信业十年来的竞争和多元化格局即将被终结。
然而，投资于三大中国电信巨头的投资者对此无动于衷。
中国电信集团(China Telecommunications Corp.)、中国移动通信集团公司(China Mobile Communications Corp.)和中国联合通信股份有限公司(China United Communications Corp.)在香港和纽约上市子公司的股票上周基本持平。在香港联交所，中国电信和中国移动上周分别下跌了1.8%和1.7%，而中国联通则上涨4%。
许多投资者并不相信这一传言。上周许多中文报纸称，政府官员正在研究大胆整合电信产业的途径。即便他们这样做，由于没有更多细节传出，政府会采取什么样的措施也尚不明了。
然而，这则消息却明确地提醒人们：虽然中国在竭尽全力地创建市场经济模式下的企业所有权结构，但企业仍然受到政府控制。许多中国最大规模企业的民间投资者仍然是无助的小股东，与中国政府的强大持股相比，他们的股权相形见绌。
里昂证券亚太公司(CLSA Asia Pacific)驻香港的电信分析师Francis Cheung称，投资中国电信类公司的香港股票和美国存托凭证的人们是将这些'中国概念股'当作拥有稳定可观利润的公用事业类股来买入的。虽然这对许多投资者都很有诱惑力，但在政府调整该行业结构的进程中可能会有意外发生。
由四大全国性运营商和两家较小企业构筑的中国电信业格局是否过于分散，难以负担3G网络设备、特别是允许数据和双向视频电话高速交换的移动系统，目前人们还意见不一。乍看起来，上周浮出水面的补救措施似乎有些牵强。
负责监管电信公司等大型国有企业的国务院国有资产监督管理委员会（State Owned Assets Supervision and Administration Commission，简称国资委）的官员们正在详细讨论关于将四大运营商合并为两大企业、或是将全部六家电信公司合并为三家企业的方案。
在四家并两家的方案中，固定线路运营巨头将与大型移动公司合并。中国最大的有线运营商中国电信将和第二大移动公司中国联通联手，而中国第二大固话运营商中国网通(China Netcom Corp.)将与中国移动合并。中国移动是中国乃至全球最大的移动电话公司。
在六家并三家的方案中，大公司将和规模较小的公司合并。中国电信将牵手中国铁通(China Railcom Co.)；中国移动将与负责国内卫星系统的中国卫通(China Satcom Co.)合并；中国联通将与中国网通合并。
以上任何一种策略都将使政府十年来推进电信行业多元化的努力付之东流。从1995年中国联通创建直到2002年中国电信分拆，众多多元化举措使得中国电信市场的订户数量由十年前不足2,000万猛增到如今的4亿。
但是，对国资委来说实施任何一种整合方案似乎都是勉为其难。 另一机构──国家信息产业部(Ministry of Information Industry)负责监管电信行业、制定费率和做出其他政策决定。该部下属机构电信研究院通信政策研究所所长陈金桥称，合并计划仅仅是少数官员和专家的话题之一。
上述电信公司的代表们表示，他们没有获得政府的相关通知。随著关于合并的消息频频见诸报端而市场却相对无动于衷，上周五中国移动的一位发言人表示，投资者不相信这些传言。
不过，分析师虽然淡化了合并传闻的可能性，但仍不敢掉以轻心，他们迅速撰文评估合并可能带来的影响。
美邦(Citigroup Smith Barney)的分析师苏布提(Rohit Sobti)写道，运营商整合遇到的技术问题是巨大的，合并之后18至24个月内这些公司的股票将不再适于投资。
美林(Merrill Lynch & Co.)的分析师斯考特(Alistair Scott)称，四家并两家的方案将使中国电信业的架构和美国类似，在美国，区域性固定线路运营商拥有全国性移动业务。但他认为，中国不必输入美国电信业那些显而易见的问题。
里昂证券的Cheung说，中国不应急于考虑3G成本问题，因为这项技术尚待成熟，而像香港和记黄埔(Hutchison Whampoa Ltd.)等推出这项业务的公司也尚未取得盈利。
他说，中国推出2G技术的时间很晚，因而可以从其他国家的技术普及中受益，并获得价格低廉的设备。但如果他们现在开始推行3G，他们就需要去推动其他国家发展这项技术。从这点来看，这不是一个好主意。
