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Huawei Technologies had been making ripples in the telecommunications industry long before it emerged as a potential bidder for Marconi.

The Chinese group's low-cost research and development and aggressive marketing techniques have made it the subject of much speculation and analysis among international telecoms equipment executives. Some observers have concluded it is one of a handful of Chinese companies that could realise its global ambitions.

While Huawei has become increasingly vocal about its hopes for international markets, it has never articulated a taste for large overseas acquisitions.

“We have adopted a different strategy from Lenovo and TCL,” said Xu Zhijun, executive vice-president, in a February interview with the FT, referring to the Chinese computer and consumer electronics groups that have made big {bs}significant {es}international purchases in the past two years. “China's biggest advantage is low-cost development.”

Responding to a question about Huawei's rumoured interest in buying Siemens' mobile arm, Mr Xu explained that any acquisition would need to be designed to make the best use of his group's R&D team.

“We have to consider about added value when we are going to do any merger or acquisition,” he said. {bs}When we sayâ.â.â.âadded value, [we mean we] can bring down the costs considerably or [the business] can be quite profitable. Otherwise there would be no added value for an acquisition.”{es}

Huawei has {bs}has also {es}said {bs}that {es}it does not have enough {bs}enough {es}money to fund large purchases overseas. This {bs}assertion {es}is difficult to verify {bs}however{es}as Huawei is not publicly listed. Last year the group secured a $360m syndicated loan from 29 banks; the Export and Import Bank of China has lent the group $600m to cover its export credits until the end of 2006; and last December, China Development Bank extended the group a $10bn credit line.

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