Rumours in Hong Kong suggest that Pacific Century CyberWorks might invite Singapore Telecommunications to take a stake in the proposed new joint venture with Telstra Corp once CyberWorks' takeover of Hong Kong Telephone has gone through. Presumably this represents an attempt by CyberWorks to head off the rumoured bid being prepared by Singapore Telephone with News Corp.
The article also said that CyberWorks could sell all or part of HKT's decreasingly profitable fixed-line network to Singapore Telephone, which would help to reduce high debt levels after the HKT takeover; the two merged networks would make a rational commercial unity.
Apart from helping to deflect Singapore Telephone's interest in taking over HKT, the defensive alliance mooted by the article would also minimise competition between CyberWorks and its prospective partner News Corp in the ongoing consolidation of the South-East Asian telecommunications and Internet markets.
Neither company has made any public pronouncement on the rumours surrounding CyberWorks offer for HKT, and it remains quite possible that Singapore Telephone will prefer to make a separate bid for HKT with News Corp and its shadowy mainland Chinese partner.
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