MUMBAI, June 15: China Telecom, an offshoot of the posts and telecommunications ministry, is to float its Hong Kong branch on the Hong Kong Stock Exchange. The listing may make the enterprise the biggest red chip stock on the Hong Kong bourse and "will serve as a conduit for the opening-up of the Chinese telecommunications business," the report said, quoting the China Business Times daily. The issue, which is reportedly worth up to HK$ 75 billion (US$9.6 billion), will be coordinated by US investment bank Goldman Sachs and underwritten by China International Capital Corporation. It follows China Telecom's recent acquisition of a 5.5 per cent stake in Hong Kong Telecom from Britain's Cable and Wireless for HK$ 9.71 billion. Cable and Wireless is expected to reduce its 54.5 percent stake in Hong Kong Telecom to 30 per cent eventually, with China Telecom raising its stake to 30 percent. The British firm, in turn, is expected to become the main investor in China Telecom (Hong Kong) and provide management and technological expertise.

Pacificorp bids for Energy GroupPacificorp, the US utility, made a friendly takeover offer for Energy Group, recently demerged from the Hanson conglomerate, worth a total $9.6 billion in cash, it said. Pacificorp has agreed to pay $11.35 per share, which represents a premium of 20 percent on Energy Group's closing share price. The offer values the fully-diluted share capital of the Energy Group at $5.97 billion.

The US group said that the sum paid would also include 3.8 billion dollars of Energy's debt. Energy Group, formed after the Hanson empire demerged into four trading arms in late 1996, comprises Eastern Groupone of 12 regional electricity companies in Britainand Peabody Coal, which operates largely in the United States. Of the 12 regional electricity supply companies that were privatised in 1990, seven have been taken over by US predators. The North American companies have shown a thirst for the deregulation pursued by the British market and see Britain as a launch pad for the European market.

US Airlines split on Japan US Airlines presented conflicting views to lawmakers on how to resolve a passenger aviation dispute with Japan, with Northwest Airlines standing firmly behind an ``open skies'' deal and other carriers calling for a more flexible approach. The debate came at a hearing of the Aviation Subcommittee under the Transportation and Infrastructure Committee of the House of Representatives. Tokyo and Washington remain at odds over the U.S. demand of setting an ultimate goal of signing an ``open skies'' agreement, but are on the verge of reaching an interim deal that would revise the passenger portion of the 1952 aviation treaty. A full open skies deal would essentially remove all restrictions on Air routes, capacity, pricing and entry.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.