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China Mobile to buy $566m Far EasTone stake
28 April 2010
China Mobile, headed by Wang Jianzhou, is expected to take a 12% stake in Taiwan’s Far EasTone for $566m
The board of Far EasTone Telecommunications in Taiwan is
selling around 444 million new shares to China Mobile for $566
million. The plan was first approved in April 2009 when China
Mobile, the world’s largest mobile operator by
number of subscribers, planned to buy a 12% stake in Far
The transaction was halted then as the Taiwanese government did
not approve the sale. The island does not permit Chinese
companies to invest in its telecom sector.
The board of Far EasTone board had to re-approve the plan for
the private placement with China Mobile, as the one-year period
for private placement will expire soon.
The board also agreed to boost the firm’s capital
spending by 38% to $282 million in 2010 from $204 million last
year. Half of the amount will be spent on capacity enhancement.