Shares of tech giant Apple (AAPL) surged on Thursday on reports it has finally entered an arrangement with China Mobile. However, the Chinese operator and the world's biggest wireless at that, denied the existence of any deal.
"Talks between China Mobile and Apple on cooperation are still going on and we currently do not have anything to announce," Rainie Lei, the carrier's spokeswoman, told Reuters.
On Thursday, shares of Apple (AAPL) closed at $567.90, up 0.5 per cent or by $2.90.
A report by the WSJ hinted the two telecom companies have inked an agreement that will see China Mobile adding iPhones to their line-up of compatible devices. Citing unnamed sources, the sale will reportedly happen later this month. The deal was to be announced on Dec. 18 at a China Mobile conference.
The scenario that Apple (AAPL) had been wooing China Mobile is very much an "open secret". In fact, the global telecoms industry had been waiting for such an agreement, knowing fully well how Apple (AAPL) will greatly benefit from it because it will enable it to access China Mobile's 759.3 million customers, as of the end of October.
An arrangement with Apple (APPL) is also a very welcome accommodation with China Mobile because it wants to be the first to legitimately sell the iPhones in China before smaller rivals China Unicom and China Telecom get to it.
Steven Milunovich, UBS analyst, said earlier this week a deal with China Mobile meant at least 10 million iPhone buyers a year.
Trefis, another research firm, said the deal could translate to 1.5 million iPhones a month, or 18 million a year.
"China consumers appear to us to have a deep admiration for Apple's products," Brian White, Cantor Fitzgerald analyst, said in a note to investors. He gave Apple (AAPL) shares a "buy" rating.
"Apple now has the opportunity to tap into the largest carrier in the world," he added.
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