Qualcomm Inc (QCOM)

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Hutchison "categorically denies" 3G rumours
Mon 31 May, 2004 10:45

HONG KONG (Reuters) - Hutchison Whampoa has said it "categorically denied" market speculation about a possible exit from its loss-making third-generation mobile telecoms business in Britain.

"Our risk period is over and we are now in the growth phase of our business," Managing Director Canning Fok said in a statement released on Monday by the ports-to-telecoms conglomerate controlled by Asia's richest businessman Li Ka-shing.

Hutchison is spending US$22 billion (12 billion pounds) on the commercially unproven 3G in the UK and Italy, as well as a handful of other European countries and Hong Kong and Australia.

Last week, the company agreed to expand its exposure to its 3 UK business in Britain with a deal to buy out NTT Docomo's 20 percent stake in the unit for about US$120 million.

After getting off to a late and sluggish launch last year, Hutchison's 3G businesses are gaining subscriber momentum. On May 20 the company said it had 1.73 million users, which amounts to 11,500 new users per day over the previous two months.

However, some analysts warned that aggressive promotions make those customers expensive to acquire.

Hutchison's bullishness on 3G has been a weight on its share price for nearly four years. Its stock fell 1.42 percent on Monday to close at HK$52.00, and is off nine percent since the start of the year.

http://www.reuters.co.uk/newsPackageArticle.jhtml?type=businessNews&storyID=520445§ion=n...