Siemens cuts its losses: sells mobile phone division to BenQ

8 Jun 2005

German technology manufacturer Siemens has agreed to sell its mobile phone unit to Taiwan’s BenQ Group. The acquisition will make Siemens’ worldwide handset business, which posted USD5.8 billion in revenues last year, a wholly owned subsidiary of the Taiwanese company. In order to secure the future of its German operations, Siemens has pledged to spend USD307 million to support domestic marketing and IP development, and will also buy a minority stake in BenQ. The mobile unit accumulated losses of USD614 million in the past year, losing market share to rivals including Nokia and Samsung, but BenQ hopes that it will break even next year through cost savings gained by combining it with its existing handset division. The agreement remains subject to approval by BenQ’s shareholders.

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