[bangkok post] The cabinet yesterday endorsed the cancellation of a plan by the state enterprise CAT Telecom to take over the small Hutch mobile network in which it is a partner.
The decision is seen as clearing the way for the third-ranked mobile operator True Move to buy the Hong Kong company's CDMA business in Thailand.
The news helped push up shares in parent True Corp Plc on the Stock Exchange of Thailand by 6.9% to 7.00 baht yesterday, in heavy trade worth 2.11 billion baht.
The shares accounted for 12% of total turnover of 17.72 billion baht on an otherwise slow day for the SET.
"This news, in our view, brings True closer to acquiring Hutch and becoming the only nationwide 3G service provider," said Kasikorn Securities.
True shares have risen 43% in the past three months on speculation that buying the CDMA business could speed up the rollout of lucrative and long-delayed 3G data services.
Information and Communications Technology Minister Juti Krairiksh said the cancellation would help the government save 7.5 billion baht.
The figure represents the amount that CAT had offered to Hong Kong-based Hutchison Telecommunications International Ltd, which earlier rejected the offer as too low.
CAT and Hutchison are partners in Hutchison-CAT Wireless Multimedia Co, whose Hutch mobile network serves about 600,000 customers in 25 central provinces including Bangkok.
The cabinet in April had approved CAT's proposal to buy out its partner but the National Economic and Social Development Board suggested that CAT needed to consider the real value of the asset.
Mr Juti said the cancellation of CAT's plan to take over Hutch would allow the state enterprise to focus instead on speeding up development of 3G wireless broadband services.
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True-Hutch deal inches closer after CAT pulls out