Hongkong Telecom has successfully acquired the Internet business of First International Computer (FIC) of Taiwan.
Late in 1998, Hongkong Telecom acquired Hong Kong rival Star Telecom’s Internet business and attained over 60 percent market share.
Hongkong Telecom said that it acquired 85 per cent stake in FIC Network Service, Inc.(FICNet), a subsidiary of FIC, at NT$157.25 million (approximately HK$38 million).
The remaining 15 percent is held by First International Computer and other Taiwanese
shareholders.
“The acquisition clearly shows that Hongkong Telecom is committed to providing the best international connectivity for its customers, and expanding its Internet presence in Asia’s key markets,” said Hongkong Telecom chief executive Linus Cheung.
“The acquisition is in line with our parent Cable & Wireless’ recent purchase of iMCI Internet business in the US,” said Cheung. “It takes us one step
further in implementing the Group’s global strategy of Internet service development.”
FIC Network Service provides its 40,000 local customers with Internet services backed by a team of 55 local staff.
An Asian Internet industry executive said this in response, “Assuming the facts in this article are correct, this would value each FIC customer at about US$144.”
“When you compare this with how much revenue each customer brings in, which is upwards of US$75 per year (based on their minimum dialup rates), I’d say the valuation looks reasonable,” he added, “I would even argue that if you throw in the
additional real and intellectual assets owned by FIC Net, it looks like HK
Telecom got a pretty good deal.”
The Cable & Wireless company has also revealed plans to build the Hong Kong Special Administrative Region into Asia’s preferred Internet hub and e-commerce center, announcing a number of initiatives to accelerate Hong Kong’s transformation into an Internet economy.
HKT plans to invest over HK$500 million (US$65 million) per year on its broadband network and develop wireless broadband multimedia services.