China’s three mobile network operators, China Mobile, China Unicom and China Telecom, have signed an agreement to sell their towers to their jointly-owned passive infrastructure firm, China Tower. Under the transfer agreement the three cellcos will exchange their tower assets for new shares in China Tower and, in the case of Unicom and Mobile, a cash consideration. China Mobile will receive a maximum of 51.110 billion new shares from the deal, whilst Unicom will be handed at most 37.743 billion and Telecom 37.473 billion. As a further addition, China Reform Corporation – an investment firm charged with revamping state-owned enterprises – will subscribe to new shares in China Tower. Whilst the exact number of shares to be issued has not yet been determined, the four companies intend for China Tower’s shareholding structure after the completion of the deal to be as follows: China Mobile 38.0%, China Unicom 28.1%, China Telecom 27.9% and China Reform Corporation 6.0%. The transfer of the trio’s mobile towers is expected to be completed by the end of the month.
As noted by TeleGeography’s GlobalComms Database, China Tower was established in July 2014 to improve investment efficiency by minimising the duplication of infrastructure, to reduce operating costs and to speed up the expansion of networks. The Ministry of Industry and Information Technology (MIIT) had originally intended for the asset transfer to be completed by end-August 2015.