International law firm Freshfields Bruckhaus Deringer has advised China Unicom (Hong Kong) Limited on its agreement with Telefónica to enhance their existing strategic alliance entered into on 23 January 2010.
Under the terms of the agreement, the parties agreed to increase their respective stakes by acquiring the equivalent of US$500 million in the other party through the purchase of each party’s shares. The parties further agreed to deepen their existing strategic alliance and cooperation in various areas. In addition, Telefónica agreed to propose at its next general shareholders’ meeting the appointment of an individual designated by China Unicom as a director to the board of directors of Telefónica.
As a result of the agreement, China Unicom’s interest in Telefónica will increase from 0.89% to 1.37%. As at the date of the Agreement, Telefónica’s interest in China Unicom stands at 8.37% of the issued share capital of the company.
Teresa Ko, China managing partner, led the Freshfields corporate team advising on Hong Kong law, supported by the partner Grace Huang, and the associates Christian Zeppezauer and Kerensa Chan, in Hong Kong. The team advising on Spanish law was led by the corporate partner David Franco, supported by the senior associate Alfonso de Marcos, in the Madrid office.
Teresa Ko commented, “I am delighted that the strategic alliance between China Unicom and Telefónica has flourished to mutual benefit. This mutual investment is a testament that strategic cooperation by foreign investors in Chinese companies can work. We are absolutely delighted to have played a part at the beginning of their relationship and to have seen it grow.”
David Franco commented: “We are delighted to have helped strengthen the existing Stategic Alliance between these two major companies. China Unicom and Telefónica are without doubt a point of reference in the worldwide telecommunications market and we are convinced that their collaboration will open the way to new strategic alliances between Chinese and Spanish companies.”
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