ZTE Corporation ("ZTE"), a leading global provider of telecommunications equipment and network solutions, announced that it has entered into a strategic partnership with China Development Bank by signing a "Development of Financial Cooperation Agreement". This partnership further strengthens the solid relationship the two organizations have previously developed.
Under the agreement, both parties will closely work together to establish an investment and financing platform, including expansion to overseas markets. According to a 5-year cooperation framework agreement, China Development Bank will provide ZTE a US$15 billion credit line, including ZTE's overseas project financing and ZTE's credit limits. The two companies are currently in discussion to develop specific terms and procedures on financing project and how to effectively execute the business cooperation.
Today, global and leading telecom operators are under enormous pressure to develop next-generation telecom technologies, such as 3G, to meet market demands. However, in view of the current global financial crisis, the majority of mainstream financing agencies based in Europe and the U.S. are trying to find ways to address issues such as inadequate liquidity and credit crunch. This is where China Development Bank has an advantage by possessing a healthy balance sheet as well as strong financing and credit ability, and sees positive future prospects for the global telecom industry.
China Development Bank pledges to help ZTE in further strengthening and upgrading its position in the global telecoms industry, hence facilitating ZTE's entry among the ranks of the world's tier-one telecom operators. China Development Bank is the fifth largest commercial bank in China. In 2008, its total assets were valued at 2,890 billion RMB with non-performing loan ratio within 1%. The bank also holds exceptional advantage in the area of export credit.
ZTE believes that by strengthening its cooperation with China Development Bank during these challenging times, it will help the company to further partner with global telecom carriers. With a strong financial capability, ZTE will be able to take advantage of potential business opportunities through a combined effort of expanding market reach and rolling out new technologies. This further helps the company to enhance its market competitiveness and ultimately achieve a win-win situation.
Despite the global economic crunch, ZTE has been upgrading its position in the industry steadily by adopting an aggressive and prudent marketing strategy. Yesterday, ZTE announced a revenue of approximately RMB 44,293 million (US$6,388 million) in 2008, representing an increase of 27.37% over 2007. In the 3G tender bids offered by China's three largest telecom operators, ZTE obtained about 30% of the total local markets to deploy about 660,000 3G carrier frequency, positioning itself as the clear leader in China's 3G industry..com/