Telefonica of Spain, the world’s third biggest telecom group by market value, has agreed to pay $290 million for a 3 per cent stake in China Netcom, China’s second largest fixed line operator, listed in both Hong Kong and New York. The move signals Telefonica’s breaking into China’s staterun telecommunications sector. The two companies are expected to cooperate in areas such as equipment purchasing, research and development, marketing and business strategies.
