Pacific Century Cyberworks has achieved one of the largest fundraising exercises in its sector — a HK$2.3 billion top-up placement. A secondary placement for shareholders in Tricom, the telecom at the heart of a reverse takeover, was less impressive. Despite cries of foul, PCCW is now on target for explosive growth. Ming Liu reports.

Pacific Century Cyberworks claims that its top-up, HK$2.3 billion ($295.6 million) mid-September share placement is the largest Internet capital-raising exercise to date in Asia ex-Japan. Regardless of its status in terms of size, the deal sits at the centre of a period of intense deal- making by the company that should see it secure its status as one the region’s most significant Internet stocks.

PCCW is the technology flagship of the Pacific Century Group (PCG) .The group, which also holds interests in property and insurance, is headed by Richard Li, son of Cheung Kong and Hutchison Whampoa chairman Li Ka-shing. PCCW came to prominence when it controversially won the right to act as the Hong Kong government’s partner in developing the HK$13 billion Cyber-port, a commercial and residential property project intended to help Hong Kong become a technology and Internet communications hub. PCCW will be based in Cyber-port, from where it will launch its regional broadband Internet service. PCCW affiliate Pacific Convergence will be the public face of the Internet service, which will be offered through a satellite to cable distribution system.

The idea of launching an Internet service provider (ISP) was born in the aftermath of the sale of Star TV, which Li started back in 1990 and sold in 1993. Reflects Francis Yuen, deputy chairman of PCCW: “At the time that PCG was formed, we had nothing but a pile of cash from the sale of Star TV” A fairly big pile of cash — $525 million — that is. Over the next year or so, Li proceeded to add to the management he had worked with at Star TV to build his new Pacific Century team.