Tietong seeks co-operation, listing

China Tietong Telecommunications Corporation (China Tietong) vowed yesterday to diversify its financing channels by seeking further co-operation with foreign finance organizations and investment companies, as well as pursuing a listing on both the domestic A-share market and overseas markets.

"This year, we are going to be involved in business integration and adjusting our subsidiaries in developed regions to attract strategic investors from home and abroad," said Zhao Jibin, China Tietong's chairman, at the company's conference in Beijing.

"Those subsidiaries will be characterized by high-quality assets, complete network coverage and huge market potential," he said.

Currently, the company's funds come largely from bank loans, which account for more than 70 per cent of the firm's total investment to date.

The company also made clear that enhancing co-operation with banks and issuing bonds to lay a foundation for its listing is a priority.

Based on the former China Railcom Group Co Ltd (CRC), China Tietong was officially inaugurated in August.

Since its founding, the firm has focused on getting listed to fund its expansion in the domestic and overseas markets.

It was reported that China Tietong will raise more than 20 billion yuan (US$2.4 billion) in the domestic A-share market by issuing 5 billion shares in January.

But Zhao refuted the rumour in an earlier interview. "We are not ready to go for a listing as we need to carry out a series of reforms and adjustments before we carry out the plan," he said.

The company will take advantage of preferential government policies to accelerate any reshuffling to consolidate its business as well as build up a positive image for investors, Zhao said.

Company figures show that it signed up 5 million new fixed-line subscribers last year, accounting for 10 per cent of the industry's total.

The company is targeting a 30 per cent annual growth in telecom revenue and fixed-line subscribers.

Also in its crosshairs is the doubling of profit year-on-year.

"We will take advantage of our experience in the railway network to co-operate with specific sectors, such as petroleum, coal, irrigation works and broadcasting and television in order to explore our network resources as well save on investment costs," he said.

Focus will also be fixed on developed areas, like China's coastal regions and the Yangtze River Delta.

Zeng Jianqiu, a professor with Beijing University of Post and Telecommunications, said he believed that concentrating on such comparatively developed business areas will help China Tietong build up its revenue and promote its brand.

"3G-related services, the digital trunking business as well as audio telephony will be at the forefront of our minds while focusing on the development of value-added telecom services," Zhao said.

According to him, the company is trying to land a licence for third generation (3G) mobile telecommunications to roll out a complete range of telecom-related services.

Currently, China Tietong is distinctive from other telecom operators as it owns a nationwide network.

After its split from the Ministry of Railways, China Tietong started to operate as an independent telecom operator overseen by the State-owned Assets Supervision and Administration Commission.

Source: China Daily