China Mobile, China Unicom and China Telecom have signed an agreement covering the plan to transfer over $36 billion worth of towers and related assets to standalone infrastructure joint venture China Tower.
The companies yesterday agreed to transfer telecom towers and related assets to China Tower in exchange for stakes in the venture.
Following the transaction, China Mobile will own a 38% stake in the venture, whereas China Telecom and China Unicom will each own around 28%. China Reform Corporation will pay cash for the remaining 6% stake.
China Mobile disclosed that the company will also be entitled to a cash payment for its tower assets, including a first instalment of 5 billion yuan due within 30 days of the deal closing.
The total value of the tower assets is a hefty 231.4 billion yuan ($36.4 billion). China Tower was established in December last year to take over construction of towers for the three state-owned operators.
The joint venture was established at the urging of the government, to help the operators reduce duplication and redundant construction of telecom towers and cut back on capital expenditure.