WITH the help of a U.S. investment firm, China Netcom Corp. has completed the acquisition of troubled wholesale carrier Asia Global Crossing , the official China Daily reported Monday.

　　"China Netcom Corp. (CNC) acquired Asia Global Crossing (AGC) for a very competitive price," said anonymous sources. But the sources did not reveal exactly how much CNC paid or who the U.S. partner is. According to the sources, AGC owns assets worth US$1.7 billion, and its networks connect to 200 cities in 16 countries and regions.

　　In an earlier report from the Wall Street Journal, a group of four bidders were readying an offer of US$250 million for a controlling stake in AGC, but the paper did not identify their names.

　　A CNN report said that a newly founded Chinese company named Purple Telecom was among the bidders for AGC. Neither CNC nor AGC were available for comment.

　　Industry insiders said that CNC's acquisition expanded the company's telecommunication capabilities in the Asia-Pacific region and made the company an international telecom carrier.

　　AGC's networks connect the major commercial cities of Tokyo, Osaka, Hong Kong, Taipei, Seoul and Singapore. It also links Asia to the United States via a trans-Pacific network.

　　AGC's trans-Pacific network is the most crucial part of the picture, industry insiders said. Linking Asia and North America, the network provides rich business opportunities and increasing information exchanges between the two continents.

　　Founded in 2000, AGC aims to meet Asia's increasing telecommunications demands. It provided the Asia-Pacific region with telecom services through a combination of underwater cables, terrestrial networks and city fiber rings.

　　59 percent of AGC is owned by U.S.-based Global Crossing, which went bankrupt in January. AGC's other major shareholders include Microsoft and Softbank.

　　Following the parent company's bankruptcy, AGC was delisted from the New York Stock Exchange in February because "it can not meet trading requirements." In February when the company said that it only had enough cash to last until the second quarter of 2003, AGC started to look for bidders.

　　CNC has kept a low profile during the last few months. Edward Tian, chief executive officer of CNC, has cut down on public appearances and refused interviews.

　　CNC is a record maker among its domestic peers. In 2001, the company broke the policy banning overseas investors on the domestice market by introducing overseas capital into basic telecom operations. Multinationals including News Corp and Goldman Sachs became CNC's strategic investors and raised US$325 million.

　　CNC merged into the northern region and became a subsidiary of China Netcom Communication Group. Edward Tian remained chief executive officer of CNC and was named vice president of China Netcom Communication Group. He is in charge of international co-operation and capital operations for the group.

　　The acquisition of AGC, according to the sources, was made by CNC, not their parent company.

　　China's telecom carriers have been very active in the capital market, forming a sharp contrast to their international counterparts.

　　China Unicom last week announced details of its initial public offering (IPO) on the domestic stock market. The IPO will raise 11.5 billion yuan (US$1.4 billion) to fuel China Unicom's construction of the CDMA network.

　　China Telecom, the dominant fixed-line carrier, was recently reported to have begun a roadshow for its IPO in the stock markets in Hong Kong and New York.

　　CNC was set up in 1999 by four organizations: the Chinese Academy of Sciences, the Ministry of Railways, the State Administration of Radio, Film and Television and the Shanghai municipal government. Its vision, to break monopolies in fixed-line telecom services, became a reality with the split of China Telecom earlier this year.

　　The former China Telecom divided into two new companies that occupy northern and southern regions.

　　China's main telecom carriers are becoming the largest in the world. They are gradually showing leadership roles in the international telecom market. Under encouragement of the government, more telecom carriers are showing strong interest in becoming international companies. CNC's acquisition of AGC may be just a start for the international expansion of Chinese companies.

　　(SD-Agencies)