Finnish telco giant, Nokia Corporation is set to offload its stake in TD Tech, a China-based joint venture with Huawei, citing concerns about increasing US-China tensions, reports ITREALMS.
Also, The South China Morning Post, reported that Nokia will sell its majority stake in the mobile networks, IoT and device technology vendor to a Chinese group that includes several state-owned entities.
Despite lots of PR guff that was churned out about the equality of the two partners in the JV, which has headquarters in Beijing and Chengdu, the reality was that Huawei was always the de facto master of TD Tech, which has been selling rebranded Huawei handsets since 2021.
Last year, Nokia tried to extricate itself from the unequal relationship by selling its share of the company to New East New Materials, a Shanghai-based ink technology outfit, but that plan did not sit well with the Chinese authorities.
Political pressure was brought to bear, Huawei kicked up an almighty fuss and said that unless Nokia changed its mind it would stop licensing technology to TD Tech, a threat that killed the deal. However, almost a year on, under the terms of the now finalised exit agreement, which was published on last Friday by China’s State Administration for Market Regulation, TD Tech will henceforth fall under the aegis of Huawei and several other companies that are either fully or partially owned by the Chinese state, including the Chengdu High-Tech Investment Group and Chengdu Gaoxin Jicui Technology Co.
Equally, involved is the Chinese (nominally private and independent) venture capital outfit, Huagai.
ITREALMS gathered that details of the equity share distribution between the new ‘owners’ have not been made public. Under the terms of the JV, Nokia owned 51 per cent of TD Tech and Huawei held 49 per cent:
Industry observers noted that the reality was the tail wagged by the dog, via the authorities, which has remained unsurprising with the new deal passed the scrutiny of the Chinese regulatory authorities.
TD Tech was founded in 2005 as a joint venture between Huawei and Siemens of Germany. In 2007, Siemens sold half its interest in the partnership to Nokia as part of the deal that saw the Finnish vendor acquire network infrastructure vendor Siemens Communications, and six years later, in 2013, the German firm sold the rest of its shares to Nokia.
Talking of Sino-US tensions, observers described as ‘interesting’ that of the Huawei handsets rebadged as TD Tech, the M40 5G reportedly does not use Huawei’s very own Kirin processor but instead comes embedded with a 7nm microprocessor supplied by MediaTek of Taiwan.
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