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US-blacklisted China Telecom plans estimated US$4 billion Shanghai listing

US-blacklisted China Telecom plans estimated US$4 billion Shanghai listing

The company logo of China Telecom is displayed at a news conference in Hong Kong, China August 20, 2018. (Photo: REUTERS/Bobby Yip)

SHANGHAI: Hong Kong-listed China Telecom, the state-owned wireless carrier blacklisted by Washington, said on Tuesday (Mar 9) it plans to sell shares in Shanghai to broaden its financing channels.

China Telecom proposes to sell up to 12.09 billion shares publicly on the Shanghai Stock Exchange, or 13 per cent of the enlarged capital base, according to an exchange filing. The company will raise roughly US$4.1 billion based on its Hong Kong closing price on Tuesday.

China Telecom may also expand its offering by 15 per cent by exercising an over-allotment "greenshoe" option.

China Telecom, China Mobile and China Unicom are appealing a decision by the New York Stock Exchange to delist their American Depositary Receipts (ADRs), after former US President Donald Trump banned US investment in companies with alleged military backing.

Index publishers MSCI, FTSE Russell and S&P Dow Jones Indices removed the three Chinese firms from their global benchmarks after they were put on the US blacklist.

A Shanghai listing can help the company "broaden sources of funds, enhance capital strengths and improve risk tolerance," China Telecom said on Tuesday.

Proceeds from the share sale, which needs shareholder and Chinese regulatory approval, will be used to fund 5G projects, cloud-network infrastructure, research and innovation, the company said in the filing.

Source: Reuters

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