Nokia and China Huaxin sign memorandum of understanding to create new joint venture by combining Nokia’s telecommunications infrastructure businesses in China (“Nokia China”) and Alcatel-Lucent Shanghai Bell (“ASB”).
As per the understanding, Nokia expects to hold 50% plus one share in the new joint venture, with China Huaxin holding the remaining shares.
The new joint venture 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 planned to operate under the English name of Nokia Shanghai Bell and would be registered in the China (Shanghai) Pilot Free Trade Zone.
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.”
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 closing of the proposed combination between Nokia and Alcatel-Lucent, Nokia China and ASB will continue to operate as two independent companies.
China Huaxin is established in the year 1993 by the Ministry of Post and Telecommunications of China to serve as a vehicle for investment in ICT assets and a platform for international collaboration opportunities in the ICT industry. It’s an industrial investment company that seeks long-term commercial growth opportunities in the Information and Communications Technologies (ICT) sector.