Huawei in touch with banks on possible IPO, nothing decided - sources
HONG KONG/SINGAPORE |
HONG KONG/SINGAPORE (Reuters) - China's Huawei Technologies Co Ltd HWT.UL, the world's No.2 telecommunications equipment maker, has been in touch with investment banks about a possible initial public offering but has not made any decisions about proceeding with a listing, sources said on Friday.
The Wall Street Journal reported earlier that Huawei had reached out to investment banks for advice on an IPO, which is seen as a way of making itself more transparent and helping it win big contracts in markets like the United States, although it had not chosen any banks and nothing had been decided.
"We haven't ruled out the possibility of a listing. We've always been in touch with banks, but I don't think anything has been decided," a source close to the company told Reuters, declining to be identified because he is not authorised to speak to the media.
Huawei has been looking at the listing issue for years, but there has been little progress due to the complicated company share structure and some doubts about whether a listing would actually help dispel suspicion that U.S. lawmakers have towards the company, sources told Reuters.
One banking source, who declined to be identified as he was not authorised to speak to the media, said Huawei had been open to the idea of going public every now and then, but he was unaware of anything happening at the moment.
Huawei, also the world's sixth-biggest handsets maker, said in an emailed statement that it declined to comment about market rumours.
Huawei and domestic rival ZTE Corp (000063.SZ) (0763.HK) have been successful in selling handsets in the United States, but they have hit roadblocks trying to sell their flagship telecommunications equipment products due to opposition from U.S. lawmakers over security concerns.
Security concerns have also stymied Huawei's access to big contracts in Australia and elsewhere. The Australian government last year cited cyber-security concerns when it barred Huawei from bidding for contracts to build the country's national broadband network.
The Wall Street Journal, citing a person familiar with the matter, said Huawei began reaching out to banks for IPO advice after being forced to drop a small acquisition early last year due to opposition from the Obama administration. Huawei is leaning towards a listing in the United States, but is also considering Hong Kong or London, the newspaper said.
Sources who spoke to Reuters, however, noted that ZTE still faces problems in cracking the U.S. telecommunications equipment market and questions from U.S. lawmakers over its transparency despite being a listed company.
(Reporting by Lee Chyen Yee and Elzio Barreto in HONG KONG, and Michael Urquhart in SINGAPORE; Editing by Chris Gallagher)
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