China clears Nokia Siemens Networks' deal for Motorola unit

The deal had faced a delay from China's Ministry of Commerce and then a lawsuit filed by Huawei

China has cleared the way for Nokia Siemens Networks to complete its acquisition of Motorola's cellular networks business, after the deal was complicated by a delay from Chinese regulators and then a lawsuit from competitor Huawei.

China's Ministry of Commerce approved the acquisition on Wednesday, said Nokia Siemens spokeswoman Riitta Mard. The deal is expected to close on April 29.

Nokia Siemens announced it would purchase the Motorola unit last July for US$1.2 billion. The acquisition was expected to make it the number three wireless network equipment vendor in the U.S., and elevate it as the largest overseas supplier of cellular infrastructure equipment in Japan.

But the deal, originally slated to close at the end of 2010, was delayed because the anti-monopoly bureau of China's Ministry of Commerce was still reviewing the acquisition.

Then in January, Chinese network equipment maker Huawei filed a lawsuit in a U.S. court to halt the deal. The lawsuit, filed against Motorola Mobility and Motorola Solutions, argued that the acquisition would transfer Huawei's trade secrets to Nokia Siemens. In the past, Huawei had provided confidential information to Motorola in order to help develop its cellular communication networks.

But earlier this month, Motorola and Huawei settled the lawsuit. Motorola would be allowed to carry out the transfer of Huawei's intellectual property to Nokia Siemens for an undisclosed fee.

By acquiring the Motorola unit, Nokia Siemens also benefits from established relationships with more than 50 telecom operators, while reinforcing its ties with carriers like Verizon Wireless, Vodafone and China Mobile. Nokia Siemens will receive about 7,500 employees from the Motorola unit.

Tags Huawei TechnologiesMotorolabusiness issuesNokia Siemens NetworksMergers / acquisitionsregulationgovernment

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Michael Kan

IDG News Service

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