Gehua Forms USD 100M Cable Broadband JV
China Securities Journal, 5/30/08
Beijing Gehua CATV Network (600037.SH) has announced the signing of a Cooperation Agreement on Forming a Broadband Joint Venture Company with Liberty Global, Inc (LGI) and PRC Venture Partners. Total investment will be USD 100 mln, with registered capital of USD 33.4 mln. Gehua Cable will take a 51% stake for USD 17.0 mln (paid in RMB). The rest of the investment (i.e. the difference between the registered capital and the USD 100 mln total investment target), will be financed through other channels.
The joint venture company will provide internet access service to residential and commercial users via Gehua's cable broadband network. Gehua will provide paid services such as technology and billing support, as well as customer service, installation and maintenance service for the joint venture company.
Gehua has one million bi-directional connections, but only 100,000 domestic broadband users. The partnership with LGI, which brings its management experience operating large-scale cable TV networks in 19 countries globally and its development capability, is expected to help Gehua more effectively market cable broadband services to consumers.
Keywords: cable broadband Gehua Internet Internet access JV Liberty Global PRC Venture Partners television 600037.SH
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