PCCW Limited (Pacific Century CyberWorks, traditional Chinese: 電訊盈科) is the dominant [1] telecommunication enterprise in Hong Kong. PCCW has been listed on Hong Kong Stock Exchange SEHK: 0008,since 18 October 1994.
Main business
Product and services offered by PCCW include[2]:
- Telecommunications services
- Landline telecommunications
- Mobile telecommunications - PCCW Mobile
- Broadband internet - Netvigator, Netvigator Everywhere, PCCW Wi-Fi
- Television and Media Content
- IT Services and BPO - PCCW Solutions, formerly Unihub, formerly PCCW Business eSolutions
- Infrastructure - Cascade, Ltd.[3]
Geographical operations
PCCW's businesses have a presence in the following countries and territories[4]:
Cascade, Ltd.
PCCW announced the formation of wholly owned subsidiary CASCADE Limited in January 2003 and transferred almost a quarter of its total work force to Cascade. Cascade employs more than 3,000 staff as of June 2003.
Cascade provides PCCW's telecommunications network operations with support and maintenance services. It provides also network infrastructure design, build-out and maintenance services, consulting solutions, customer installation and maintenance services, project management, operating systems development and maintenance and technical support to clients other than PCCW.
Started from Dec 08, Cascade became a Subsidiary of PCCW-HKT Limited, which PCCW-HKT is still 100% owned by PCCW. The name of Cascade is removed from now on, become a part of HKT and named as "Engineering", a business unit of PCCW-HKT, simply like Commercial group of PCCW. All staff in Cascade had transferred to PCCW-HKT without changing.[3]
PCCW Solutions (Unihub, Business eSolutions)
PCCW Solutions is the information technology services and business process outsourcing (BPO) division of PCCW. Press releases prior to February 2006 refer to it by the name Unihub.[5]. Unihib was a re-branding of PCCW's Business eSolutions division, from 1 September 2003.[6]
Business eSolutions division formed a venture with China Telecom to provide IT solutions to major business organizations in 2002. This was in addition to PCCW's PCITC alliance with Sinopec, formed to serve Sinopec plus other players in China's petrochemical sector. The division also contributed to the new Hong Kong Identity Card system in 2003.[5]
In early 2003, Business eSolutions entered a contract to provide services for Bank of China's credit-card back office processing system in China.[citation needed] It also extended a 2002 enterprise resource planning (ERP) project into more provinces for China Mobile and completed the flight information display system (FIDS) for Xiamen Airport, and a human resource management and financial management system for the Hong Kong Council of Social Service.[citation needed]
Education
The PCCW foundation has provided sponsorship for local data network service for the Internet2 project initiated by the Joint Universities Computer Center (JUCC). The project enables staff and students at local universities to connect and exchange with Internet2 universities all over the world in researching the next generation of networking technologies.
The foundation also supports the Workplace English Campaign and other education-related initiatives, such as annual scholarships for top students nominated by local universities.
PCCW provides communications services for a variety of social service schemes. This includes support for students, single parents, the unemployed, distressed people and the elderly who benefit from counseling hotlines, info-line services for Medilink and networks to help find employment.
Incident with YouTube
On 24 February 2008, PCCW was blamed for blocking users around the world from accessing the video sharing website YouTube. While attempting to block internet users in Pakistan, following orders from the Pakistani Government, PCCW accidentally blocked all of their users from the website. The blockage spread worldwide via incorrect BGP routing tables published by PCCW, coming originally from PieNet in Pakistan.[8][9]
Corporate history
PCCW was formed by Richard Li Tzar Kai, the younger son of Hong Kong tycoon Li Ka Shing. Formerly Pacific Century Development, it was an investment holding company. The company's English name was changed from "Pacific Century CyberWorks Limited" to "PCCW Limited" on 9 August 2002.
It then won a controversial land deal, acquiring valuable waterfront real estate from the government without any public auction bids. Many in Hong Kong cried cronyism, as the Hong Kong Government, under chief executive Tung Chee Hwa, gave away the land to his new high-tech residential and commercial venture called Cyberport.[10]
PCCW acquired Hong Kong Telecom (HKT) in August 2000, which was formerly known as the Hong Kong Telephone Company (founded in 1925).[citation needed] Initially, HKT owner Cable & Wireless entertained a bid from Singapore Telecommunications, but there was local concern about a Singapore company owning the largest Hong Kong telephone system.[citation needed] PCCW entered the scene and offered Cable and Wireless PCCW stock and US$11 billion in bank loans.[citation needed] The acquisition vaulted PCCW from a small 1990s dot-com holdings company to one of the largest corporations in Hong Kong. PCCW is now also the leading Internet service provider in Hong Kong,[citation needed] using the Netvigator brand for dialup modem and DSL service. PCCW has been the object of much scorn in Hong Kong as a result of the HKT purchase.[citation needed] In 2003 the company's stock price was down 96 percent from its 2000 peak.[citation needed] In the face of challenges due to debt, intense local telecoms competition and a struggling international joint venture Reach (50/50 owned by PCCW and Telstra), PCCW was the worst-performing blue chip on the Hong Kong Stock Exchange (HKSE) in 2002 and 2003.[citation needed]
In 2003, Cable and Wireless finished cashing in all the stock from the 14.7 percent stake it had in PCCW. Worth US$5 billion at the time of the 2000 acquisition of HKT, the stock sales yielded only $1.9 billion in the end.[citation needed]
Richard Li gave up his spot as PCCW's chief executive officer in July 2003 but remained as chairman and executive director. Jack So, who left his chairman position at Hong Kong subway operator MTR Corporation Limited, took up the job of group managing director at PCCW on 25 July 2003.
Attempted exit
Although PCCW's substantial shareholder China Netcom had earlier expressed objection to any disposal of key assets to foreign groups, it also refused to increase its stake; Richard Li attempted to exit from the business in 2006. Li received competing offers by two consortia led by Australia's Macquarie Bank and private equity firm Texas Pacific Group/Newbridge submitted expressions of interest last month to acquire PCCW's core telecom and media assets.[11]
PCCW chairman Richard Li has agreed to sell his indirectly held 22.66 percent stake in PCCW on 11 July 2006 to Fiorlatte Ltd, a new startup company wholly owned by Francis Leung Pak-to, for a total consideration of HK$9.16 billion. In turn, Francis Leung Pak-to has agreed to sell an 8% stake in PCCW to Telefónica for 323 million euros.[citation needed] Leung, former Peregrine investment banker, is closely associated with Li Ka-shing. PCCW's stock, which had joined Hang Seng Index (HSI) index on 9 August 2000,[12] ceased to be a HSI constituent, effective 10 June 2008.[13] PCCW
Purported Cable & Wireless takeover bid
News report from the Sunday Times on 6 February 2003 revealed that PCCW made a preliminary takeover approach to Cable & Wireless on December 2002 as the British company's share languished near record lows.[14]
Li told the Sunday Times newspaper that PCCW would not launch a hostile bid for C&W but that the two companies could work together to enhance shareholders' value.
The Times quoted Li as saying that he was planning to try again that week with a two billion pound (US$3.27 billion) bid for C&W. Following the news report, PCCW issued a statement through the Hong Kong stock exchange on 6 February 2003 morning saying it had not made a formal offer for C&W and was not in takeover talks with the company. Later in the day, in London and Hong Kong, PCCW issued statements saying it had made a preliminary takeover approach to C&W in a letter at the end of 2002.
PCCW apologised on 10 February 2003 for making what were seen by some in the market as contradictory statements. The Hong Kong Stock Exchange demanded an explanation from PCCW after noting discrepancies between the two statements regarding its approach to C&W about a possible bid.
In any case, C&W had rebuffed PCCW's takeover approach by February 2003.[15]
Privatization plan
An attempt was made in December 2008 to take the company private. On 30 December, majority shareholders Pacific Century Regional Developments, controlled by Richard Li, and China Unicom Group raised their joint offer for PCCW from HK$4.20 a share, minutes before shareholders were due to vote on the original buyout plan.
In a heated shareholders meeting held on 4 February 2009 which lasted seven and a half hours, the shareholders approved the PCCW plan allowing its majority shareholders to force out all minority shareholders of the company amidst allegations of vote-buying.[16] Privatisation would allow PCCW to be delisted from Hong Kong Stock Exchange,[17] while its parent would remain listed in Singapore.
Governance activist David Webb alerted the authorities to allegations that hundreds of agents at Fortis Insurance Co. (Asia), once part of PCCW, may have been given board lots of 1,000 PCCW shares.[18] The Securities and Futures Commission found that Francis Yuen, a Li associate and member of the buyout group, had instructed a senior executive at Fortis to distribute PCCW shares to about 500 Fortis agents. Yuen and Fortis Asia regional director, Inneo Lam, had exchanged telephone calls shortly before Lam ordered half a million PCCW shares that were later spilt into board lots and given away to his staff;[19] Lam's secretary had asked for, and received, share transfer forms from Yuen's secretary. Majority shareholders gained approval from the High Court to proceed in their US$2.2 billion privatisation, but the Appeals Court unanimously overturned the ruling.[20]
See also
References
- ^ "About Us/Company Profile". PCCW. 2008. http://www.pccw.com/eng/AboutUs/CompanyProfile.html. Retrieved 2008-03-18.
- ^ "Product(s) and Services". PCCW. 2008. http://www.pccw.com/eng/Products/AllProducts.html. Retrieved 2008-03-18.
- ^ a b "Cascade Limited: About Us". Cascade. 2003. http://www.cascade-ltd.com/abtus/index_company.html. Retrieved 2008-03-18.
- ^ "About Us/PCCW around the world". PCCW. 2008. http://www.pccw.com/eng/AboutUs/PCCWaroundtheworld.html. Retrieved 2008-03-18.
- ^ a b PCCW Solutions. "News & Events". Press release. http://www.pccwsolutions.com/a5.html. Retrieved 2008-04-13.
- ^ PCCW Solutions (2003-11-17). "PCCW attains BS 7799". Press release. http://www.pccw.com/NASApp/cs/ContentServer?pagename=PCCW/COMMON/newspopup&pageid=1058030271674&pagelang=eng. Retrieved 2008-04-13.
- ^ "YouTube outage blamed on Pakistan". BBC News. 2008-02-24. http://news.bbc.co.uk/1/hi/technology/7262071.stm. Retrieved 2008-02-25.
- ^ Stiennon, Richard (2008-02-24). "Pakistan removed from the Internet". Threat Chaos. ZDNet. http://blogs.zdnet.com/threatchaos/?p=548. Retrieved 2008-02-25.
- ^ "Cyberport critics get stake hint". AFP. Hong Kong Standard. 21 March 1999. http://www.thestandard.com.hk/news_detail.asp?pp_cat=&art_id=25641&sid=&con_type=1&d_str=19990321&sear_year=1999. Retrieved 2007-01-11.
- ^ Hong Kong PCCW's Li sees decision on any asset disposals by mth-end, AFX News Limited, Forbes Magazine, 3 July 2006
- ^ "Changes in HSI Constituent Stocks" (Excel/XLS). Hang Seng Indexes. http://main.hsi.com.hk/hsicom/constituent/hist_hsi.xls. Retrieved 2008-05-09.
- ^ Hang Seng Indexes (2008-05-09). "Hang Seng Indexes Announces Index Review Results" (PDF). Press release. http://main.hsi.com.hk/hsicom/announce/20080509e.pdf. Retrieved 2008-05-09.
- ^ "Hong Kong tech firm mulls C&W bid". BBC News. 2003-02-10. http://news.bbc.co.uk/1/hi/business/2741919.stm. Retrieved 2008-03-18.
- ^ "Cable & Wireless shuns PCCW". The Asian World Street Journal. 2003-02-10. http://findarticles.com/p/articles/mi_hb4692/is_200302/ai_n17657584. Retrieved 2008-03-18.
- ^ Benjamin Scent, "It's outrageous", The Standard, 21 April 2009
- ^ Mark Lee, PCCW Investors Approve Li's $2.05 Billion Buyout Bid, Bloomberg, 4 February 2009
- ^ Frederick Yeung, "PCCW move to go private approved", Page A1, South China Morning Post, 5 February 2009
- ^ Jonathan Cheng (30April 2009) Regulators Detail PCCW Allegations, Wall Street Journal
- ^ Reuters (17 Apr 2009) HK court hears call for PCCW privatisation revote
External links
