China Unicom Shares Drop as Mixed-Ownership Plan Disappoints
(Bloomberg) -- China Unicom (Hong Kong) Ltd., China's second-largest mobile carrier, fell the most this year after the Hong Kong-listed company signaled it will miss out on a mixed-ownership plan being pushed by the government for its state-owned enterprises.
The stock declined 3.9 percent, the biggest drop since Nov. 11, to close at HK$10.44 on Thursday. Unicom resumed trading after the company said yesterday that its Shanghai-listed affiliate, China United Network Communications Ltd., could see its shareholding structure change after the restructuring, without any mention of changes at Hong Kong-listed company.
The Shanghai-listed stock was also halted on Wednesday, and was still suspended from trading.
Using the Shanghai-based company as a platform for reforms would be more complex than using the Hong Kong company, which may disappoint investors, Joel Ying, an analyst Nomura Holdings Inc., wrote in a note to clients.
Both companies are units of Unicom Group, which was among six state-owned enterprises picked by the nation's economic planner last year for a pilot program in mixed-ownership -- China's preferred term for private investments into state firms. It's part of the government's broader push to overhaul its bloated SOEs, whose total revenue figure rivals the size of Japan's economy.
To contact Bloomberg News staff for this story: Jing Yang de Morel in Shanghai at jyang543@bloomberg.net.
To contact the editors responsible for this story: Young-Sam Cho at ycho2@bloomberg.net, Dave McCombs
With assistance from Jing Yang de Morel
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