State-owned China Unicom says parent reviewing mixed-ownership structure

HONG KONG, April 6 (Reuters) - State-owned China Unicom Hong

Kong Ltd said its top shareholder China United Network

Communications Ltd was reviewing its ownership

structure as Beijing puts pressure on telcos to bring in private

investors and boost competition.

The country's big telecommunication firms - China Unicom,

China Telecom Corp Ltd and China Mobile Ltd -

are all units of unwieldy state-owned enterprises.

Those parent firms are seen as overstaffed, inefficient and

slow to develop key technologies, prompting the call to bring in

private firms, which have shot ahead in developing cloud and big

data services as well as mobile software.

China Unicom will be among the first batch of state-owned

enterprises expected to introduce private shareholders in a

pilot scheme of ownership reform.

The Shanghai-listed parent company will be used as a

platform for the mixed ownership reform, China Unicom said in a

filing to the Hong Kong bourse late on Wednesday.

"As the related plan for these matters is still under

further deliberation, these matters are still subject to

substantial uncertainty," added China Unicom, in which China

United Network owns a 75.94 percent stake.

Hong Kong-listed shares of China Unicom, which were halted

on Wednesday, opened up 3.1 percent as trade resumed on Thursday

at HK$11.2 - the highest since October 2015. But the gains were

erased later with the shares down about 1 percent by 0255 GMT.

China United Network, which was also halted on Wednesday,

said it will remain suspended from trading until further notice.

China Unicom, the worst-performing telco among the three

state-owned firms, said in October that it was included in the

pilot mixed ownership reform scheme. Last month, it reported a

94 percent drop in profit for 2016.

Analysts expect the company to face further headwinds this

year due to the government's call on telco operators to lower

rates.

(Reporting by Donny Kwok and Sijia Jiang; Editing by Himani

Sarkar)