[Ben]

As 3GScottishUser has long suspected, it looks like Hutchison have finally cut and run on Three UK and Italy, with the deal set to take place tomorrow:

http://www.newswireless.net/index.cfm/article/3075


By end of Friday, Hutchison Whampoa will have announced the sale of its European 3G franchises - both in the UK and in Italy - to China Mobile; thus confounding the hopes of European operators like TIM and Vodafone of picking up some cheap spectrum.

The deal is being finalised today, as 3 UK sends out sample X Series products.

Price? Ordinary commercial considerations, say sources, don't apply here. "You could say that the Chinese authorities gave Hutchison a simple choice of whether to sell to China Mobile, or alternatively, to sell to China Mobile," said one cynical-sounding insider.
*snip*


Nobody is likely to guess a figure higher than the £4.2 billion originally paid by Hutchison for the UK 3G wireless spectrum, however. And several guesses will be that China Mobile is spending substantially below that. One insider, involved in one of the other bids, said that "the figure is not unrelated to the name of the company, but you can't quote me..."
Sounds like Hutchison will be bowing out with its tail well and truly between its legs. On the other hand, it sees the entrance of China Mobile into the UK.

[3GScottishUser]

This news was expected and full marks go to the Daily Mail for their prediction last week.

It's the end of the road for Hutchison Whampoa in terms of 3 in the UK and many will be happy to see the back of them. Their opportunist move to do 'another Orange' simply did'nt materialise as most customers simply did'nt want the extra services and those that tried them were left dissapointed by the user experience and lacklustre customer service.

3 UK willl remain an independent network and I suspect China Mobile (of which Vodafone is a 5% shareholder) will have to work hard to build alliences for convreged offerings and perhaps relaunch 3 as something new ridding themselves of the dreadful reputation HWL has earned it.

It's a new dawn and there will be lots of changes and I'm pleased to have had the foresight to predict this development.

[getti]

What does this mean for 3 customers and staff?

[Hands0n]

It can only mean good things - certainly better than they are at the moment.

Initially, at least, there will almost certainly be a shedding of senior and upper/middle management. I don't believe that it makes any sense at all to shed grass-roots service personnel. It all rather depends on what China Mobile intend to do with the 3 franchise in the UK and Italy.

Will it be rebranded? HSBC got rid of its "Hong Kong Shanghai Banking Corporation" name when it re-headquartered into the UK. This was to allow it to present itself as a credible "UK Bank" having acquired Midland Bank at the time.

I suspect that 3 will be rebranded, but not to China Mobile for the same reasons that HSBC changed its name. But they have to lose the synonymism that 3 has with poor quality Customer Services and [intially] crappy handsets. Although, it will be for nought if they do not bin Mumbai CS in the very short future. If they persist with that millstone-round-the-neck it will hurt them in the UK as badly as it does today!

I'm anticipating only good things to come out of this acquisition - but we have to allow it time to set in. This will not be an overnight sensation, rather we could still be discussing this in 12 months time!

[3GScottishUser]

Nothing in the short term..... but there will be big changes obviously to try and rectify the mess HWL have made. China Mobile won't want to repeat the kind of losses HWL have suffered.

It will be interesting to see what happens with the franchises in Superdrug.... those only happened because HWL own the stores.

Only time will tell I suppose...

One thing is for sure China Mobile could not do worse!!!

[@NickyColman]

Does anyone really know anything about China Mobile? How big they are? Are they market leaders? Is China Mobile as advanced as Three technology wise?

[miffed]

Ha Ha ! ..... Mugs !

Fortunately for Hutchinson there is one born every minute :D

[3GScottishUser]

Look them up in Wikipedia.....

They are the world's biggest cellular operator by users (291 million).... although by turnover it's Vodafone by a long chalk!!

Vodafone have a 5% share in China Mobile Ltd.

China Mobile Limited ( formerly named China Mobile (Hong Kong) Limited ) (the “Company”, together with its subsidiaries, the “Group”) was incorporated in Hong Kong on 3 September 1997. The Company was listed on the New York Stock Exchange and The Stock Exchange of Hong Kong Limited on 22 October 1997 and 23 October 1997, respectively. The Company was admitted as a constituent stock of the Hang Seng Index in Hong Kong on 27 January 1998. As the leading mobile services provider in Mainland China, the Group boasts the world's largest unified, contiguous all-digital mobile network and the world's largest mobile subscriber base. In 2005, the Company was once again selected as one of the “FT Global 500” by Financial Times, and “The World's 2000 Biggest Public Companies” by Forbes magazine. Currently, the Company's corporate credit rating is A- /Positive Outlook by Standard and Poor's and A2 /Outlook Stable by Moody's (respectively equivalent to China's sovereign rating).

All you need to know is here: http://www.chinamobileltd.com/

As for technology, Hutchison like all the rest bought their UMTS technolgy off the shelf from Qualcomm who are the licence holders for W-CDMA.

It's going to be tricky for China Mobile as they will inherit a pretty poor business and as an independent operator have exactly the same challenges that Hutchison faced. Just what they will be able to achieve will be interesting. They have their work cut out for them and the big 4 are not going to make life easy. Whilst I am positive China Mobile intend this to be a long term investment nothing can be taken for granted and in another year or so if there is no progress they might decide to exit the UK getting the best price they can.... just as NTT DoCoMo, KPN and now Hutchison Whampoa have.

[Ben]

It's interesting to me that Vodafone have a (small) vested interest in the success of China Mobile's purchase. One has to wonder if we'll see any collaboration between the two in the future, like in terms of Vodafone's 2G coverage.

I also find the Superdrug aspect very interesting. Fortunately 3 is/was in the process of building up a good portfolio of stores, so lets hope we finally get the separation of mobile and mascara - a duo that were never meant to be.

Most importantly I'd imagine the move will bring some stability to Three. Hutchison were always going to sell up at some point, just like they did with Orange, though I'm sure they imagined they'd be doing so once the business was equally as successful. Now Three has found itself a (hopefully) more permanent parent, however, I'm sure that gravy-train of cash is going to have to stop... and you never know, that could cause some serious growing pains.

[3g-g]

It's interesting to me that Vodafone have a (small) vested interest in the success of China Mobile's purchase. One has to wonder if we'll see any collaboration between the two in the future, like in terms of Vodafone's 2G coverage.

I also find the Superdrug aspect very interesting. Fortunately 3 is/was in the process of building up a good portfolio of stores, so lets hope we finally get the separation of mobile and mascara - a duo that were never meant to be.

Most importantly I'd imagine the move will bring some stability to Three. Hutchison were always going to sell up at some point, just like they did with Orange, though I'm sure they imagined they'd be doing so once the business was equally as successful. Now Three has found itself a (hopefully) more permanent parent, however, I'm sure that gravy-train of cash is going to have to stop... and you never know, that could cause some serious growing pains.

I think Orange have the 3 NRA sewn up for the next 5 years, so if anything was to become of the Vodafone relationship it's a good while off. Needless to say I'm amazed that this has popped it's head up without warning, I still can't find anything on Google News yet, so 'till I read some sort of mass reporting about it I'll need to remain sceptical! Call me cynical why don't cha!

Either way, if it happens it's exciting, and if ChinaMob do take over I don't think there'll be a cut to the spending, quite the opposite, they've bought a business with less than a third the customers of the other 4, with poor CS and no positive cash flow (with the scope for that to continue 'till 2008), so they must know what they're getting into? I think they'll need to dig deep at first, the UK market is the most advanced in the world, everyone wants a piece of the pie here, and if that means an outlay then so be it.

As far as a re-brand, I'm not sure, although I think it may be wise. Calling a company "Three" has done nothing for the introduction of the technology into the UK, I'd go as far to say it's only hampered it. Prior to launch they were Hutchison 3G, I think they should of stuck with that.

Without doubt this thread and others, if it all goes ahead, are going to be here for the foreseeable future. Exciting times ahead!

[Ben]

There's a lot of confusion at the moment. Nobody seems to be giving a difinitive answer as to what is going on...

http://www.forbes.com/home/feeds/afx/2006/12/15/afx3257890.html

"Hutchison rose sharply today in Hong Kong on talk of the sale of the 3G business. China Mobile's share price however fell as the rumor triggered concerns that it is buying a loss-making business."

[3GScottishUser]

"It was not clear whether the reported deal involves Hong Kong-listed China Mobile Ltd or its mainland parent.

The spokeswoman for China Mobile Ltd said she is only speaking for the unit."

http://www.forbes.com/home/feeds/afx/2006/12/15/afx3257890.html

It appears there is a compnay called China Mobile (Hong Kong) Ltd and a parent called China Mobile Communications Corporation based in Bejing..... the latter is the state owned controlling company, the denial was issued by the Hong Kong company who have been careful to attribute their comments to themselves.

The plot thickens....

[3g-g]

Ah well, here you go!


Shares in Hong Kong billionaire Li Ka- shing's flagship company Hutchison Whampoa (0013) jumped as much as 5.3 percent Friday after a fake statement in the name of China Telecom (0728) was circulated among investment banks in the United States and Britain.

The fake statement, which purported to have been issued to the Securities and Exchange Commission in Washington, said Hutchison Whampoa would sell 15 percent of 3 Italia, the conglomerate's Italian telecommunications arm, to China Telecom for HK$9.486 billion, and that the deal would be completed by March 31 next year.

The fake statement was e-mailed to investment banks in the United States and Britain with the aim of boosting the share price of Hutchison Whampoa, sources with knowledge of the situation said. Turnover in Hutchison shares Friday amounted to HK$4.464 billion - almost four times Thursday's trading volume.

"It is impossible to trace the e-mail address of the person who sent the fake statement," the sources said.

"And even if the person were identified, Hutchison Whampoa has no grounds to sue. However, China Telecom may have the right to take legal action because the statement used the company's name."

A lawyer, who asked not to be identified, said it is difficult to "determine whether he or she is liable for offenses such as market manipulation," even if that person is proved to have Hutchison Whampoa shares. "After all, it is not that person who directly pushes up the share price but, rather, it is up to all the big players [investment banks] whether or not to believe the statement and whether or not to buy the shares," the lawyer said.

There were also rumors that Hutchison Whampoa would announce the sale of its third-generation mobile phone operations in Europe to China Mobile (0941) by the end of the day Friday. Both China Mobile and Hutchison denied the report.

Hutchison also denied speculation that China Telecom is planning to buy 3 Italia.

"By the end of Friday, Hutchison Whampoa will have announced the sale of its European 3G franchises - both in the UK and in Italy - to China Mobile, thus confounding the hopes of European operators like TIM and Vodafone of picking up some cheap spectrum," British personal computing pundit Guy Kewney wrote late Thursday on his personal Web site newswireless.net, citing unnamed sources.

Kewney is a long-time personal computing journalist who currently works as European wireless editor for Ziff Davis Publishing's eWeek.com and as a columnist for industry publication IT Week.

"I just want to clarify that this is speculation," said China Mobile representative Rainie Lei. "The company doesn't have such acquisition or anything going on like that."

Laura Cheung, Hutchison's spokesperson in Hong Kong, also denied reports that the company has any plans to sell off its 3G mobile phone operations.

Hutchison stock closed Friday at HK$78.20, up 2.9 percent from the previous day's close of HK$76. China Telecom ended down 0.81 percent at HK$3.66.

China Mobile dropped 0.16 percent to HK$62, while the benchmark Hang Seng Index edged up 0.5 percent Friday.

There has been rampant market speculation in recent weeks that Hutchison would sell its European 3G operations. Its 3G business globally lost HK$12 billion before interest and tax in the first half of the year.

China Mobile is the largest mobile operator in the world by number of subscribers and market capitalization.

It completed its acquisition of Hong Kong mobile operator Peoples in March and has said it is looking for further acquisitions in foreign markets.

Now, call me cynical still, but wouldn't this be a great way to create some quick profit in shares and then sell perhaps? Could this of been let into the public domain specifically to aid someone / group / company? Seems rather suspect if you ask me...

http://www.thestandard.com.hk/news_detail.asp?pp_cat=2&art_id=34252&con_type=1