Hutchison may cancel PCN plans in Britain

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The Independent Online
HUTCHISON WHAMPOA of Hong Kong is expected to abandon plans to set up a personal communications network (PCN) to rival cellular radio and fixed telephone networks in the UK, writes Mary Fagan.

The move would be a blow for the Government's drive for competition as the only other PCN licensees, Mercury and US West, have already merged their mobile telephone projects.

Hutchison is so far denying newspaper reports in the Far East that it would abandon PCNs, along with most of its other overseas telecommunications ventures. Li Ka-shing, the group's chairman, said: 'To further clarify the position with regard to the company's United Kingdom operations in telecommunications, it is our firm intention to continue to support this investment.'

But UK analysts said that the PCN operation has been unofficially up for sale for some months. It is believed that the parent group is unwilling to pay the estimated pounds 600m needed to establish the PCN network.

The high start-up cost of Hutchison's telecommunications operations in Britain has been of increasing concern to Hong Kong analysts. In August Hutchison announced a loss of HKdollars 78m ( pounds 6.4m) in the six months to 30 June, compared with a profit of HKdollars 2.04bn a year earlier. The group blamed a large provision for its Canadian unit, Husky Oil.