Huawei Technologies Co (華為) plans to sell its undersea telecom cable business, a buyer’s filing showed yesterday, in its first major asset sale since the US ratcheted up accusations of the Chinese firm being a vehicle for espionage.
Hengtong Optic-Electric Co (亨通光電), an optical telecommunication network products company based in Jiangsu Province, said in the filing to the Shanghai Stock Exchange that it on Friday signed a letter of intent with Huawei Technologies subsidiary Huawei Tech Investment Co (華為技術投資) to buy its 51 percent stake in Huawei Marine Systems Co (華為海洋網絡) via cash and share issuance.
The filing did not disclose a price.
Huawei Technologies declined to provide comment when contacted by reporters.
The potential sale comes as Huawei’s main business of making and selling telecom network equipment and smartphones is under intense global scrutiny as the US works to persuade its allies that Huawei’s products pose a security risk.
Huawei has said it would not cooperate with any Chinese state request to access its systems for intelligence purposes.
Even so, the US Department of Commerce last month imposed a trade ban that threatens to significantly disrupt its supply chain.
In March, the Wall Street Journal cited US security officials as saying that the suspected security risk extended to undersea cables built by Huawei Marine.
Undersea cables are the backbone of global Internet traffic. Huawei has been gaining share in the market dominated by US firm SubCom LLC, Japan’s NEC Corp and Europe’s Alcatel-Lucent SA, since Huawei Marine was established in 2008 as a joint venture with the UK’s Global Marine Group.
Huawei Marine has participated in 90 projects worldwide and built 50,361km of cables, its Web site showed, including a 6,000km cable connecting Africa and South America for the first time, completed in September last year.
It booked net profit of 115 million yuan (US$16.66 million) for last year on revenue of 394 million yuan, according to Huawei Technologies’ annual report.
The annual report also showed that Huawei Technologies gained majority voting rights on Huawei Marine’s board in August last year, with Global Marine retaining a 49 percent non-controlling interest.
According to exchange filings, Hengtong Optic-Electric’s largest shareholder is privately owned Hengtong Group (亨通集團) with a 15.66 percent stake.
Hengtong Group’s founder and owner Cui Genliang (崔根良) is the second-largest shareholder with 14.95 percent.
Hengtong Group on its Web site said it is China’s biggest solutions provider in fiber-optic networks and smart electricity grids, with more than 70 subsidiaries at home and abroad, including Indonesia-listed cable maker PT Voksel Electric Tbk.
Hengtong Optic-Electric booked net profit of 2.5 billion yuan for last year on revenue of 33.9 billion yuan, according to its annual report.
It has delivered more than 10,000km of undersea cables, including for projects in Papua New Guinea, Chile, Bolivia and Mexico, the annual report showed.
END TO SPECULATION: The hotel’s management contract has been extended, despite reports that it wanted to end its alliance with Hyatt Hotels over a deal with Riant Capital Singapore-based Hong Leong Hotel Development Ltd (豐隆大飯店股份) yesterday said it has extended a management contract to ensure the continued presence of the Grand Hyatt brand in Taipei, ending rumors that the two sides were parting ways. “We are pleased Hyatt is able to come to terms on the extension of the management contract of Grand Hyatt Taipei,” said Kwek Leng Beng (郭令明), executive chairman of City Developments Ltd (城市發展) and Millennium & Copthorne Hotels Ltd (千禧國敦酒店). Hong Leong Hotel Development is a subsidiary of Millennium, and both fall under the Hong Leong Group (豐隆集團). The Grand Hyatt Taipei (台北君悅大飯店), owned and built by
’WHITE BOX’: The open platform would give local firms access to Cisco’s cloud-based mobile network to develop 5G telecom equipment and tap into the global market The Ministry of Economic Affairs (MOEA) yesterday introduced a new 5G “open lab” in collaboration with US-based information technology and networking giant Cisco Systems Inc to address the rapidly growing “white box” 5G networking equipment market. The open lab will be a platform where Taiwanese manufacturers can access Cisco’s cloud-based mobile network to develop their own 5G telecom equipment, such as small-cell base stations, network switches, modems and Internet of things (IoT) devices, a ministry statement said. The open platform would allow Taiwanese manufacturers to tap into the lucrative 5G telecom equipment market, which was previously monopolized by Nokia Oyj, Ericsson AB
Nintendo Co is raising its target for Switch production to about 25 million units this fiscal year, people familiar with the matter said, as the ongoing COVID-19 pandemic keeps lifting demand and component shortages ease. The Kyoto, Japan-based company, which in April hiked orders to 22 million units by March next year, is asking partners to tack on another few million units, said the people, who did not want to be identified discussing internal goals. Assembly partners plan to work at maximum capacity through December. The new production target suggests that Nintendo is likely to outperform its Switch sales forecast of 19 million
‘BIG LOSS’: This year might see the last generation of Huawei’s Kirin chips, as their production would stop next month because they are made using US technology Chinese tech giant Huawei Technologies Co (華為) is running out of processor chips to make smartphones due to US sanctions and would be forced to stop production of its own most advanced chips, a company executive has said, in a sign of growing damage to Huawei’s business from US pressure. Huawei, one of the biggest producers of smartphones and network equipment, is at the center of US-Chinese tension over technology and security. Washington last year cut off Huawei’s access to US components and technology, and those penalties were tightened in May, when the White House barred vendors worldwide from using US