China Mobile to buy 12% of Far EasTone

China Mobile yesterday announced that it has entered into an agreement to buy a 12% stake in Taiwanese mobile phone operator Far EasTone Telecommunications, worth NT$17.7 billion $528 million. This is the first major deal between China and Taiwan since cross-strait relations started to thaw last year.

China Mobile will subscribe to 444 million shares at a price of NT$40 per share, a 15.3% premium to Tuesday's closing price of NT$34.70.

Underlying the transaction is a strategic agreement to cooperate in the development of both company's businesses, said China Mobile in a stock exchange filing. The areas of cooperation will include joint purchases, roaming, data and value-added businesses and network...