China Netcom appeared set to pay around US$1bn for a 20% stake in Hong Kong phone company PCCW Ltd., sources close to the deal told Reuters. The figure is considerably higher than investors had expected, representing a premium of about 20% on the company's current share price. Analysts said Netcom, the smallest of China's big four telcos, was prepared to pay the price as part of a drive to expand its business in southern China and overseas. Neither PCCW or China Netcom commented on the report.
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