TCL Corp to list handset business in Hong Kong

31 Mar 2004

Shenzhen-listed TCL Corp, a state-controlled consumer electronics manufacturer based in Guangdong, has revealed plans to spin off its cellphone business TCL Mobile and list it on the Hong Kong stock exchange. The parent did not give financial details or a timetable for the listing and the proposal is subject to ratification from directors, shareholders and regulators, but industry watchers anticipate that an IPO will be launched this year and could raise up to HKD1.56 billion (USD200 million). According to local sources, TCL Mobile is valued at HKD1.3 billion.

TCL Corp hopes that a Hong Kong listing will make its mobile unit stronger and consequently better able to compete on the world stage. The unit currently controls around a tenth of China’s domestic handset market, having stolen business from established international rivals such as Motorola, Siemens, and Nokia. An IPO may also benefit TCL Corp’s Hong Kong-listed unit TCL International Holdings, which is expected to report lower earnings this year following last month’s decision to merge TCL’s television operations with those of French maker Thomson. TCL International Holdings owns 40.8% of TCL Mobile with TCL Corp controlling a further 36%.