ZTE sells stake in ZTEsec

Summary:Embattled Chinese telecoms vendor sells its stake in the surveillance systems maker to 10 Chinese investment firms to focus on its core businesses.

ZTE has sold off its 68 percent stake in ZTE Special Equipment (ZTEsec), which offers surveillance systems, as it looks to focus on its core businesses amid falling profits. 

In a Reuters report Tuesday, it said ZTE decided to divest its stake in ZTEsec on Sep. 21 during the U.S. Congressional committee investigations into the company and rival Huawei Technologies.

A filing to the Hong Kong Stock Exchange in September confirmed the sale, it added. ZTE sold its 68 percent stake in ZTEsec to 10 Chinese investment companies including Shenzhen Capital Group in a deal worth between 360 million yuan (US$57 million) and 440 million yuan (US$70 million), the filing stated.

This would allow ZTE to "focus its resources on its principal businesses in line with the requirements of its strategic development", the company added.

ZTE had earlier this week predicted its third quarter could make a loss of up to 2 billion yuan (US$317 million) as U.S. investigations into its deals in Iran adversely affected business for the period. This, in turn, is likely to drag its first nine months' overall earnings into the red and it is expecting a loss in net profit of up to 1.75 billion yuan (US$277 million).

 

 

 

Topics: Tech Industry, China, Security

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A Singapore-based freelance IT writer, Kevin made the move from custom publishing focusing on travel and lifestyle to the ever-changing, jargon-filled world of IT and biz tech reporting, and considered this somewhat a leap of faith. Since then, he has covered a myriad of beats including security, mobile communications, and cloud computing... Full Bio

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