China Tower files IPO application

Chinese state-backed tower company China Tower has filed an application for an IPO on the Hong Kong Stock Exchange (HKSE) that could raise as much as $10 billion.

The company, which was created to hold the tower assets of China’s big three state-backed operators China Mobile, China Telecom and China Unicom, filed its IPO documents on Monday.

The report cites unnamed sources as stating that China Tower is expected to seek a valuation of up to $40 billion, although the final size of the offer will depend on market sentiment.

China Tower is the world’s largest tower company, operating around 1.9 million tower sites across China. The company’s net profit grew more than 25 times last year to 1.9 billion yuan, according to its prospectus.

China Tower was established in 2015 as part of a government-directed initiative to eliminate inefficiencies and duplication of assets. China Mobile, China Unicom and China Telecom agreed to transfer their tower assets to the joint venture in exchange for a 38%, 28.1% and 27.9% stake respectively. State-owned asset manager China Reform Holding took the remaining 6%.

The joint venture had initially planned to hold its IPO early this year, but had reportedly faced delays in securing the needed approvals.

China Tower’s IPO could be the second $10 billion public offer on the HKSE this year. Earlier this month Chinese smartphone maker Xiaomi filed documents for its own IPO.