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Tencent to bid for stake in CRC’s WiFi subsidiary: Caixin
Posted on Friday, 13 April 2018 11:47
China Railway’s (CRC’s) sale of 49.0 per cent of Bullet Train Networks for at least CNY 3.05 billion (USD 485.14 million) has captured the attention of Tencent, the vice president of the conglomerate’s Internet Plus division told Caixin. Zhang Wei said the powerhouse will actively bid for the stake offered in the company, which is the sole operator of WiFi services on select bullet trains. Free access is already available on the Shanghai-Beijing line but CRC is trying to improve Internet stability in tunnels and mountainous areas amid the last phase of its Guangzhou–Shenzhen–Hong Kong Express Rail Link. The state-owned train operator kicked off plans to turn Bullet Train into a joint venture in early April in a bid to raise funds to pay down debt. However, as Caixin points out, the stake sale is also in line with China’s strategy of opening up the capital of state-owned businesses to private bidders in a so-called mixed-ownership reform. Zhang noted the investment would let Tencent tap into demand for online access generated by a large number of urban travellers while positioning itself for growth in this burgeoning category of the mobile Internet market. The company would provide its services, such as online payment, games and social media platforms, to railway passengers. Furthermore, it could well have a chance of extending its reach to those businesses based in train stations, such as cafes and shops. However, Tencent may be up against e-commerce juggernaut Alibaba, Caixin reported, before adding Jack Ma had actually met with CRC’s general manger in November to talk about a possible tie-up. An article by SmartRail World in March said China is attempting to attract new customers to its railway services by turning trains into interconnected communication hubs. Onboard control and monitoring systems transmit data to and from network control centres to improve safety and efficiency. Along with infrastructure, other sources that generate data also include ticket sales, station gates, video surveillance and car parks, the transit technology news website noted. © Zephus Ltd