The State Administration for Market Regulation approved China Unicom, the country's major telecommunications operator, and Tencent Holdings, a leading internet firm, to set up a joint venture recently, according to the website of the market regulator.

Shares of China United Network Communications Ltd. soared as its regulatory go-ahead for a joint venture with Tencent Holdings Ltd. buoyed investor sentiment.

The newly-established joint venture, established by the venture capital arms of two companies, will focus on content distribution network and edge computing business

The company, one of China's largest telecom carrier and parent of Hong Kong-listed China Unicom (Hong Kong) Ltd., rose by the daily limit of 10% to end at 3.75 yuan ($0.52) on Wednesday.

The venture capital arm of China Unicom will hold 48 percent of the shares while Tencent's subsidiary firm will hold the remaining.

The gains took place mostly in the final hour of trading, after state media Securities Times drew investors' attention to the latest approval of a joint-venture deal between units of China United Network and internet giant Tencent.

The two companies received regulatory approval for a joint business in computation and server operations, according to an earlier statement by China's State Administration for Market Regulation, the country's top market watchdog.

The joint venture will be controlled by China United's and Tencent's subsidiaries, which will hold a 48% and 42% stake in the new company, respectively.