CHINA Mobile Communications, owner of the world's most valuable phone company, has dropped its policy of only pursuing investments that result in management control after competition for phone assets drove up share prices.
"In the past, the only policy was: we have to get majority shares," Chief Executive Wang Jianzhou said yesterday. "But now, we are changing the policy."
The strategy shift widens the number of possible investments for China Mobile's state-owned parent, which made its first international acquisition last year with the purchase of Pakistan's Paktel.
Investors seeking to profit from developing nations have pushed up the MSCI Emerging Markets Telecommunications Services Index 29 percent in the past 12 months, compared with a 6.5- percent drop globally.
The company is keeping its focus on emerging markets in Asia, Africa and the Middle East for possible stake purchases, Wang said at the Boao Forum for Asia conference in Hainan.
The Chinese company doesn't have a target investment for now, he said.
"Many operators are chasing the same assets in emerging markets, so they are very expensive," Wang said.
China Mobile, which bought Paktel for about US$460 million, is competing with carriers including Singapore Telecommunications and Hutchison Telecommunications International for assets in emerging markets, where operators are adding subscribers at a faster rate than in developed economies because of lower mobile-phone penetration.
Shares of Hong Kong-listed China Mobile fell 3.7 percent to HK$126 as of the midday trading break. The stock has lost 8.6 percent this year, compared with a 14-percent decline in the benchmark Hang Seng index. China Mobile saw its stock double last year after profits rose 32 percent to a record 87.1 billion yuan (U$12.4 billion).