China's major telcos eye massive financing for 3G

(Xinhua via NewsEdge) China Mobile, China Telecom and China Netcom, all plan to return to mainland stock markets seeking ton of fresh capital to build infrastructure to implement a new generation of mobile phone service.

With licenses for the so-called 3G mobile technology expected to be announced early this year, China's major telecommunications operators may need to quickly raise as much as 100 billion yuan ($12.8 billion) to build and maintain the required new networks.

Market watchers believe all three companies will look to domestic markets to raise the required funds.

A fourth player, China Unicom, is currently the only major telecommunication operator that is listed on both overseas and mainland stock markets.

A spokesperson for China Mobile, the largest Chinese mobile operator, said it is the company's intention to raise funds on the mainland market, but there is not a concrete timetable for an IPO.

China Mobile is listed on the Hong Kong stock market as a red-chip company, which are mainland companies registered overseas. Red-chip companies cannot directly go public on the mainland A-share market according to current Chinese regulations.

China Mobile can bypass this obstacle by setting up a new company on the mainland, analysts said.

Analysts meanwhile say China Netcom has been in contact with stockbrokers and is drawing up plans for an A-share market listing.

Insiders say China Telecom is studying proposals from investment banks to raise 40 billion yuan ($5.13 billion) by issuing A-shares in the second quarter of this year.

The Chinese government has promised that 3G service will be up and running by the 2008 Beijing Olympic Games.