China Mobile the Actual Rescuer for TIME?



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Jul 26 2007
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Who would have guess that Malaysia loss-making Time DotCom Berhad (TIMECOM: stock-code 5031) had quietly sneaked out of the country desperately looking for life-partner? Everyone thought this hopeless stock would either partner with a local telco company (DIGI.com or Telekom) or be bailed out by the government. Hence, Time Engineering (KLSE: TIME, stock-code 4456) together with Time DotCom’s stocks price were bid up when the rumor hit the street that Hong Kong-listed China Mobile Ltd is interested in Time Engineering which holds 40.68 percent stake in Time DotCom.

However, Second Finance Minister Nor Mohamed Yakcop said today the Malaysian government is not aware of the interest by China Mobile. As usual, you’ve to take the statement by Yakcop with a pinch of salt as he seldom issues concreate statements. China Mobile (HKG: 0941) could indeed be talking to Time Engineering and unless China Mobile denies it, the rumor and possibility of Time DotCom finally being rescued will continues.
With more than RM850 million in debts, Time is dying and if the country’s coffer allows it, the government would definitely not think twice about bailing it out, the same way billions of public money was being used to do so during previous premier Mahathir’s rule, not to mention Time is one of the important business entity within UMNO, the biggest party component in the current ruling government.
FinanceTwitter would not be surprised should the acquisition goes through if the recent contract to provide soft-loan, design and build the second multi-billion Penang bridge by a Chinese-based company is used as the gauge of Malaysian Government’s approach towards Malaysia-China business relationship. While former premier adopted pro-Japan policy, current Badawi could be adopting pro-China policy which makes sense looking at how the emerging giant is giving even U.S. a headache on the huge trade inbalance in favor of China.
Nevertheless FinanceTwitter would be interested to know the final stake that Time is willing to let go – definitely China Mobile will not accept anything less than a controlling stake, would it?
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