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Philips Sells Mobile Phone Business to CEC
(SinoCast China IT Week Via Thomson Dialog NewsEdge) SHANGHAI, April 11, SinoCast -- Royal Philips Electronics of the Netherlands has sold the remains of its mobile phone business to China Electronics Corporation (CEC), a maker of integrated circuits, computer hardware, and communications and digital products, Europe's largest consumer electronics maker announced on April 8 (the Holand time).
The Chinese company is set to take over the Philips mobile phone business, which generated an operating revenue of about EUR 55 million during the first quarter of 2007, compared with around EUR 100 million in the period a year earlier.
For CEC, it is a far-reaching deal, part of the Chinese company's efforts to develop into a large transnational corporation in the world, Chen Zhaoxiong, the general manager, said. CEC is an important state-owned company under watch of China's state-owned assets watchdog State-owned Assets Supervision and Administration Commission under the State Council, the nation's cabinet, thus, the deal is a prelude to the acquisition of foreign assets conducted by a Chinese state- owned company.
The deal, the general manager said, gives CEC an opportunity of seeking leaping growth for its mobile phone business. It becomes an effective impetus toward the business's whole development and accelerating its access to the world market.
As early as October 2006, Philips signed a letter of intent on the sale of its mobile phone business with CEC. The business was focused on the Asia Pacific and East European areas. It brought a yearly sale of EUR 4 million, involving about 240 employees.
And both sides reached a final agreement about the business this February. The transactions were scheduled for completion at the end of the first quarter and still obedient to approvals of the shareholders and government regulators.
In 2006, CEC's mobile phone business hit a sales income of CNY 9.2 billion, accounting for 15.3% of the company's total incomes. The business represented 8.3% of its overall profits.
China Electronics Corporation Holdings Co., Ltd. (SEHK: 0085), a Hong Kong-listed subsidiary of it, specializes in the manufacture and sale of mobile phones in China.
CEC has other listed affiliates and subsidiaries including Chinasoft International Ltd. (SEHK: 8216), Great Wall Technology Co., Ltd. (SEHK: 0074), Amoi Electronics Co., Ltd. (SHSE: 600057), China National Software & Service Co., Ltd. (SEHK: 600536), CEC CoreCast Corporation Ltd. (SHSE: 600764), formerly known as Gansu Tristar Petrochemical (Group) Co., Ltd., Shanghai Belling Co., Ltd. (SHSE: 600171), and so on.
(USD 1 = CNY 7.73)
Copyright 2007 Sinocast
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