Nokia and China Huaxin Post & Telecommunication Economy Development Center (“China Huaxin”) is known to sign a MoU reframing their intention to combine Nokia China and Alcatel-Lucent Shanghai Bell into a new joint business corridor.
The MoU will enable Nokia to hold 50% plus one share in the new joint venture, with China Huaxin holding the remaining shares. The new joint venture is planned to operate under the English name of Nokia Shanghai Bell and would be registered in the China (Shanghai) Pilot Free Trade Zone.
According to the release, Rajeev Suri, President and CEO of Nokia Corporation, said, “Today’s agreement demonstrates Nokia’s deep commitment to China. Together with China Huaxin, Nokia will be in an excellent position to support strategic initiatives of the Chinese government such as “Internet Plus” and provide a strong link between Europe and China. We look forward to joining with China Huaxin and ASB to drive innovation for customers in China and to help accelerate the country’s shift to an innovation-driven economy. With this MoU now in place, we will also work closely with our new partners to make the case for swift approval of the proposed combination between Nokia and Alcatel-Lucent by the appropriate Chinese authorities.”
The alliance is conditional on and would be formed after the closing of Nokia’s planned combination with Alcatel-Lucent, at which point Nokia would own 50% plus one share of ASB. The new joint venture is expected to be a strong national asset based in China capable of delivering value for both parties.
The new joint venture would have one board of directors, one management team, unified customer and business functions, and one integrated product portfolio and R&D platform.
Yuan Xin, Chairman, China Huaxin, said: “We are pleased to have signed this agreement with Nokia, and firmly believe the proposed combination would reinforce our companies’ presence in China. By bringing these two entities together, the new company would possess greater capacity for innovation and outstanding R&D capabilities, delivering benefits to our customers and shareholders alike.”
Until the final completion Nokia and Alcatel-Lucent, Nokia China and ASB will continue to operate as two independent companies.