China's online giants back deal to shake up state telco

Hong Kong

SOME of China's biggest technology players are backing a plan to invest nearly US$12 billion in one of the country's telecommunications giants, the latest move in a broader government push to shake up the country's bloated state-run companies.

But it is an effort that, so far, has left experts unimpressed.

The telecom giant, China Unicom, said on Wednesday that its parent company would raise US$11.7 billion by selling shares to a number of Chinese firms as well as to employees. Altogether, the outside companies would have roughly a one-third share in the Unicom group.

China Unicom said the funds would be used to help pay for development of a next-generation cellular and data network, among other uses. It also "expects to furth…