China Telecom Seeks to Acquire MediaTek

A source familiar with the situation has revealed that China Telecom (NYSE: CHA; 0728.HK) has been seeking to acquire MediaTek, the Taiwanese fables semiconductor firm "for at least three months now." The source says China Telecom has already purchased shares of MediaTek in second-tier markets through peripheral companies, and will show its hand once it has an absolute majority of shares.

MediaTek currently has no CDMA product line, but the source notes that the semiconductor firm's chip platform "is most mature in its models, so technical formats won't be a problem. The main reason it hadn't chosen CDMA was because of Qualcomm CDMA patents and a grim outlook for the CDMA market at the time."

Sohu IT quotes a China Telecom spokesperson as saying that internal communications had "basically confirmed" that the report was a groundless rumor.