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The China Netcom Group Corp (Hong Kong) Ltd is paying 12.8 billion yuan (US$1.58 billion) to buy four provincial networks from its state-owned parent company.
Tian Suning, board chairman of China Netcom, made the announcement Monday evening while reporting on the first-half performance of the company.
Under the terms of the deal, China Netcom will assume 23.2 billion yuan in debt while buying the networks in the provinces of Jilin, Heilongjiang, Shanxi and Inner Mongolia, making the total cost 36 billion yuan.
China Netcom, a listed subsidiary company of the state-owned China Network Communications Group,dominates fixed-line phone systems in northern China. The company had 29 million fix-line subscribers by June.
On Monday, China Netcom posted a 30.4 percent rise in six month net profits to 6.36 billion yuan, with its sales volume growing 5 percent to 33.7 billion yuan during the same period.
Triggered by its sound performance, shares of China Netcom at one point rose by 4.2 percent to 13.70 HK dollars on Monday.
(Xinhua News Agency September 14, 2005)
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