China Unicom shares surge after resumed trading

Updated 2017-08-21 13:30:17 Xinhua

China Unicom saw its shares surge by the daily limit of 10 percent on the Shanghai Stock Exchange Monday after the telecommunications carrier confirmed plans to bring in strategic investors including Alibaba and Tencent.

The rise came after a trading suspension of more than four months, during which the company contemplated and advanced the so-called "mixed-ownership reform," which includes private placement of its shares.

In an announcement Monday, China Unicom confirmed plans it disclosed last Wednesday that its Shanghai-listed unit will issue no more than 9.04 billion shares to raise as much as 61.73 billion yuan (more than 9 billion U.S. dollars) from investors, including Internet giants Alibaba, Tencent, and Baidu, as well as the state-owned China Life Insurance.

The scheme will proceed under previous regulation in place before new refinancing rules were enacted on Feb. 17, 2017, according to a statement released by the China Securities Regulatory Commission Sunday.

During Monday morning trading, companies related to the mixed-ownership reform saw their shares surge. Suning Commerce Group, one of China Unicom's investors, jumped over 4 percent at one point before trending down slightly.

Guangdong Eastone Century Technology Company, another firm related to the reform, saw its shares surge by the daily limit of 10 percent.

China Unicom, the country's second-largest telecom company, was among the first group of state-owned enterprises (SOEs) to pilot the mixed-ownership reform as the government worked to revitalize torpid SOEs, a key link in developing a market economy.

During the first half of this year, the company reported a year-on-year rise of 74.3 percent in net profits, an increase that it attributed to its transformed business patterns and continued reform.

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