The struggling mobile phone division of Siemens is to be sold to Taiwan-based BenQ Group, which also produces mobile phones as well as digital cameras, scanners and LCD screens. The deal is expected to close in the fourth quarter of Siemens’ fiscal year.
Described as a “partnership”, Siemens will invest in BenQ by purchasing shares of the company, which will be headquartered in Munich. The transaction also includes the rights to the Siemens brand name, which BenQ will be allowed to use for a total of five years.
The acquisition will strengthen BenQ’s GSM mobile phones business. BenQ said it intends to expand mobile devices into a core business in the future.
In its Asian home market, BenQ already numbers amongst the fastest-growing vendors in the mobile segment. The partnership with Siemens will enable BenQ to implement an ambitious plan for global expansion, particularly in markets that Siemens has leading-market positions such as Eastern Europe and Latin America.
Through the acquisition BenQ will also obtain a world-famous brand name, mobile telephony technology and software competence, as well as global access to Siemens broad customer base.
Klaus Kleinfeld, CEO of Siemens AG, commented: “With this partnership, we have found a sustainable perspective for our mobile phones business. BenQ and Siemens complement on another ideally. We will be uniting our strengths with BenQ’s highly successful consumer business.
“This will give BenQ, which up until now has been very strong in Asia, access to the Euroepan and Latin American markets where we hold leading positions.”
The deal will see the transfer of a total of 6,000 Siemens employees worldwide to BenQ’s workforce. BenQ will also acquire Siemens’ outstanding manufacturing operations on three continents.
While no actual acquisition price has yet been revealed, in the course of the transaction Siemens will acquire new BenQ shares worth €50m and will use BenQ as a preferred partner for end-to-end mobile communications solutions.
BenQ’s chairman and CEO, Ky Lee commented: “With the acquisition of Siemen’s mobile phone business, we are rapidly approaching our goal to become one of the world’s leading players in the mobile phone industry.
“Our expansion strategy will be strongly supported by this deal, as we can rely on a global organisation with excellent employees, a well-established blue-chip customer base in the mobile business and a strong brand with high impact,” Lee said.
By John Kennedy
