The companies will form a joint venture in which Hutchison will hold 60% and Investor 40%. The two companies previously partnered to acquire Guoco Land, subsequently renamed imGo, to develop mobile internet businesses in Asia.
In teaming with a deep-pocketed partner like Investor û the company has net assets of $20 billion û Hutchison is following a strategy that served it well when it bid with Telesystem International Wireless of Canada for a 3G license in the UK. Hutchison paid 4.38 billion pounds ($6.67 billion) for the UK license.
"Investor is Sweden's largest holding company and they have a broad network in the technology sector, which will be an asset for our bid for Sweden's 3G license," says Canning Fok, Hutchison's group managing director.
Hutchison is trying to build a Europe-wide mobile phone network based on 3G technology, which will enable high-speed internet access over mobile devices. Unlike the UK, which auctioned its licences, Sweden will decide on the basis of a "beauty parade," or an analysis of each company's business plan, tariffs and strategy.
The announcement comes as France yesterday announced it too will hold a "beauty contest" to determine which companies will receive licences. The government plans to charge companies Ffr32.5 billion ($4.7 billion) for each 15-year licence. The South China Morning Post reportedáthat Hutchison plans to team up again with Telesystems to bid for one of the four French licences.