China Mobile Purchases Stake Into Thai-based True Corp.
True Corp. a Thai phone company that’s been backed by billionaire Dhanin Chearavanont, has announced its plans of selling a steak of around 20 percent to China Mobile Communication Corp, recently stated by people who are close to this matter.
The Bangkok-based company also plans to offer currently existing investor the right purchase seven new shares at 7 baht a peace of every 10 they already own, according to one of the informants, who wished to remain anonymous. That’s a 6 percent discount from True’s last traded price before a stock of suspension today.
Thailand’s third most largest mobile phone company is searching to raise funds to cut debt and fund the rollout of a faster fourth-generation network to help meet surging demand for mobile data. This offering arrives right after the Thai army manage to seize complete control during the previous month in order to end six months of political stalemate between Yingluch Shinawatra’ government and its opponents.
“The company’s huge debt and interest costs have been a hangover on its business and operation,” Rutsada Tweesaengsakulthai, an analyst at Phillip Securities (Thailand) Pcl, said by phone. “The company also needs new capital in preparation for the new telecom licenses that will be opened for bidding in the next few months.”
True shares have increased up to 2.8 percent before the stop, giving it a market value of up to $3.3 billion. True’s board shall meet to make a “decision on significant matters,” the company stated in exchange filing earlier today announcing the suspension.
Reuters reported the share sale plan earlier today, citing an anonymous person.
China Mobile Communication first expansion outside its home based market by acquiring control over Millicom International Cellular SA Pakistan unit during 2007 for a total of $ 284 billion. Listed unit China Mobile Ltd. During the previous year it had scrapped an agreement to purchase stake in Taiwan’s Far EasTone Telecommunications after the island wouldn’t ease curbs on mainland owner ship.