Antitrust review delays Motorola unit's sale

An extended review by Chinese antitrust officials is delaying Motorola Solutions' plan to sell its wireless equipment business to Nokia Siemens Networks.

Motorola's plan to sell its wireless network business to Nokia Siemens Networks has been put on hold by Chinese antitrust officials.

Under the $1.2 billion deal announced last summer, Nokia Siemens Networks will acquire the unit from Motorola Solutions. But approval of the acquisition is hitting a snag in China, where antitrust regulators have extended their review period by 60 days, Motorola said today.

Antitrust approval is needed in each market affected by the deal, according to Bloomberg, and all other approvals were received by the end of last year.

When the deal was first announced last July, both companies said they expected it to be completed before the start of 2011.

Nokia Siemens said today that it is still committed to the deal but cannot offer any further forecasts on when it might be finalized. The intended acquisition is in a third phase in China's review process, the company said. Phase 1 is a 30-day preliminary review; phase 2 points to further review that lasts 90 days, and phase 3 is 60-day extension.

The acquisition is also facing hurdles in the U.S. where Chinese telecom equipment maker Huawei is suing Motorola over charges that the deal could reveal trade secrets about Huawei to rival Nokia Siemens.

Motorola has been selling Huawei's wireless equipment for years. And since both equipment and employees from Motorola would be transferred to Nokia Siemens, Huawei is concerned that confidential trade secrets could end up in the hands of a major competitor.

Huawei recently won a court order that prevents Motorola Solutions from revealing any secrets about Huawei. However, the order doesn't stop the acquisition itself from going through. As a next step, Huawei is looking for Motorola to engage in arbitration talks to ensure that its intellectual property rights are protected.

 

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