Hong Kong Goliaths Form E-Commerce Venture

Two of Hong Kong's largest holding companies will join a pair of the territory's leading banks to form an e-commerce venture with investment of more than HK$3 billion (US$386 million), the companies announced yesterday.

The company, iBusinessCorporation.com, will leverage the strength of Cheung Kong (Holdings) Ltd., Hutchison Whampoa Ltd., Hongkong & Shanghai Banking Corp.

Ltd., and Hang Seng Bank to launch Internet-related businesses over the coming months, according to a statement by Cheung Kong.

The venture is the biggest yet in a string of moves by Hong Kong's business goliaths, most of them currently focused on property, development and finance, to get a piece of a regional Internet sector that is believed to be still in its infancy.iBusinessCorporation.com aims to leverage the strengths of the four companies to become the dominant service provider and facilitator for Hong Kong businesses that want to participate in e-commerce, according to the Cheung Kong statement. The new company will be based in Hong Kong but intends to expand throughout Asia as its business grows.

Cheung Kong and Hutchison will own approximately 75 percent of the venture, with the two banks holding the other approximately 25 percent. The partners may make further investments beyond the HK$3 billion in the future, according to the statement.

The venture will bring a focus to the Internet businesses of the two flagship holding companies controlled by Hong Kong tycoon Li Ka-shing. Cheung Kong is one of Hong Kong's leading property and development holding companies, and Hutchison has a broader range of investments, including telecommunications.

Hongkong & Shanghai Banking Corp. and Hang Seng both are members of London-based HSBC Group.

Cheung Kong can be reached at +852-2128-8888 or on the Web at http://www.cheungkong.com. Hutchison Whampoa can be found online at http://www.hutchison-whampoa.com. HSBC is online at http://www.hsbc.com.

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