China Mobile in ground-breaking Taiwan investment

China Mobile has said it plans to take a 529 million dollar stake in a top Taiwan telecom firm in what would be the first major direct investment by a mainland company in the island since a 1949 split.

China Mobile, the world's largest mobile phone operator by users, said it would buy a 12 percent stake in Taiwan's Far EasTone Telecommunications for about 17.8 billion Taiwan dollars (529 million US).

Completion of the deal is subject to regulatory approvals, China Mobile said in a statement issued Wednesday to the Hong Kong stock exchange, where the company is listed. The two companies would enter into a strategic alliance upon completion of the transaction, it said.

The announcement came after China said this week that it would allow Chinese companies to invest directly in Taiwan, beginning Friday, for the first time since their split at the end of a civil war.

China views Taiwan as part of its territory awaiting reunification, by force if necessary.

BEIJING, April 30, 2009 AFP