China Unicom chairman Yang Xianzuc now has almost $5bn to spend

China Unicom, until now a state-owned corporation, has proved popular with investors keen to get a slice of the potentially lucrative telecommunications market in China.

China Unicom is seen as particularly attractive because of it's mobile telephone network and internet businesses.

China's telecommunications market is rapidly expanding and will open to the outside world once the country joins the World Trade Organisation.

Many analysts predict that mobile phones will dominate the Chinese market, because mobile networks can be expanded far quicker than fixed-line ones.

Expansion plans

China Unicom raised almost $5bn with its flotation on the stock market.

It plans to use the proceeds to expand the capacity and coverage of its mobile telephone network, expand its fibre optic transmission network, its data network and its internet business.

The China Unicom flotation dominated headlines on the Hong Kong Stock Exchange

The strong interest in China Unicom shares comes after investors in Hong Kong were caught up in a stampede to buy shares in the internet firm tom.com earlier this year.

Unicom's initial offering, the largest ever in Asia, outside Japan, has proved popular as well, although it did not provoke quite the same levels of interest.

However some analysts are warning that China's telephone network will take years to open up.

Unicom shares closed their first day of trading at HK$16.90, below an early peak of HK$17.30 but well above the offer price of HK$15.58 a share for institutional investors.