NYSE begins delisting process for three of China's state-run telecom giants

The firms can easily raise money by selling shares in Hong Kong Photo: Reuters
The New York Stock Exchange said it would delist China’s three big state-run telecommunications companies following an executive order from the Trump administration, in a symbolic severing of longstanding ties between the Chinese business world and Wall Street. The exchange said in a statement late Thursday that it would halt trading in shares of China Mobile, China Unicom and China Telecom by January 11.

It cited an executive order issued in November by the Trump administration that barred Americans from investing in companies with ties to the Chinese military.

The US Department of Defense had previously listed the three companies as having significant connections to Chinese military and security forces. The companies’ Hong Kong offices did not immediately respond to requests for comment on Friday. The move is likely to have little impact on China’s military or security ambitions, which are generously funded by Beijing, or on the companies themselves, which can raise money from international investors by selling shares in Hong Kong.

Still, the delisting of the three telecom giants reflects China’s rise in power and wealth, as well as the growing estrangement between the world’s two biggest economies.

It also highlights the faltering of long-established business ties between the US and China, which were set up over decades as China sought to internationalise and reform its state-run corporate behemoths.

All three companies operate under Beijing’s firm control. They are ultimately owned by a government agency, the State-owned Assets Supervision and Administration Commission, and are often ordered to pursue Beijing’s goals. China’s ruling Communist Party sometimes shuffles executives among the three companies.

They are the only three companies in China that are allowed to provide broad telecommunications network services, which Beijing regards as a strategic industry that must remain under state control.

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