PacificNet Sells Off 51 Percent of 3G

PacificNet, a vendor of Customer Relationship Management (CRM), mobile internet, e-commerce and gambling technology in China, has announced that it has entered into a definitive agreement to sell its entire interest of 51 percent ownership in Guangzhou 3G Information Technology Co., a Value-Added Services Internet company in China, to HeySpace International.

The sale price for PacificNet's 51 percent ownership in Guangzhou 3G is $6 million to be paid in cash in five installments over seven months. PacificNet acquired 51 percent controlling interest in Guangzhou 3G in March of 2005 for $5.5 million consideration which was paid partially in cash and mostly in PACT stock.

HeySpace International is a social network services and virtual community service provider in China, and an integrated Internet and mobile entertainment media platform base on Web2.0 technology.

Based in Guangzhou and Hong Kong, HeySpace is building a "lifestyle and community destination" in China.

"This strategic sale made business sense," and was in line with PacificNet's "new focus" on gambling, said Tony Tong, CEO of PacificNet: "As we stated previously in our conference calls, PacificNet will continue to seek strategic alternatives for our legacy businesses while focusing on gaming and CRM going forward. We will continue to explore strategic sale of our legacy businesses including our other value-added service units, mobile e-commerce distribution and telecom units."

Tong said PacificNet's goal is to "streamline our operation, downsize the non-performing legacy operations, and simplify our business strategy with an emphasis on our new focus on gaming technology development."

A couple months ago Tong said the Philippine gambling market is "even bigger than Macau" in terms of gambling machine installations and presents "huge opportunities" for PacificNet Games.

Tong said he believes the Philippine market will continue to grow rapidly as one of the top destinations for Chinese tourists from China, Taiwan, Hong Kong and Macau, since it is only a two-hour flight from Manila to Hong Kong.

After achieving early success in the Macau gambling market, Victor Tong, President of PacificNet said, he believes PacificNet is "ready to expand into other parts of Asia" as he sees strong demand and opportunities for growth in other Asian gambling markets.

According to recent report by Global Gaming Business, Jeffries Wall Street, the Philippine gambling market consists of about 5,000 gambling machines, over 620 gaming tables and over 8,500 positions, and represents the second largest gambling market in Asia, after Macau.

David Sims is a contributing editor for TMC (News - Alert) Net.  For more articles please visit David Sims' columnist page.

Third Generation (3G)	X
A variety of cellular phone specifications collectively known as Third Generation mobile technology. 3G networks do not operate in the same frequency spectrum as 2G. Examples of 3G wireless specs incl...more

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