China Netcom Group Corp (Hong Kong) Ltd said it plans to delist its shares from the Hong Kong stock exchange on Oct 15 due to its merger deal with China Unicom Ltd.

Netcom's American depositary receipts (ADRs) are also expected to be withdrawn from the New York stock exchange on the same day, Netcom said in a statement.

The company said a shareholder meeting will be held on Sept 17 to vote on the Unicom merger plan.

Under China's telecom industry restructuring plan unveiled in June, China Netcom will be merged with China Unicom's GSM mobile network, while China Telecom will take over Unicom's CDMA mobile network.

The last day for dealings of Netcom shares in Hong Kong and ADRs in New York will be Oct 6.

Separately, China Unicom said in a statement that it will issue 10.3 bln shares, equivalent to 75.32 pct of shares outstanding after the exercise of options, to China Netcom for the merger. The issue is 10.1 bln shares or 73.93 pct of total shares prior to the exercise of options.

The company said that each China Netcom share will be swapped for 1.508 new China Unicom shares, while each American Depositary Share exchanged for 3.016 new China Unicom ADSs.

Based on China Unicom's share price of 18.48 hkd prior to its suspension on May 23, the total value of the transaction is seen at 182.77 bln hkd after the exercise of options or 179.40 bln hkd with no options exercised.

China Unicom added that its chairman and chief executive Chang Xiaobing will become chairman and CEO of the newly formed company, China Unicom (Hong Kong) Ltd, that will emerge after the deal.

After the transaction, Netcom will become a wholly-owned subsidiary of Unicom.

Unicom said its minority shareholders will vote on the merger plan on Sept 16.

Source:XFN