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ZTE suspends its activities and pondering the sale of mobile units

Forecasts about the collapse of ZTE after the imposition of US sanctions seem to have come true. As it turned out, last week the Chinese producer stopped major business operations and so far has not seen any positive prospects in its situation.

What happened

ZTE stopped the production of smartphones, and also closed its official online store and blocked the page on the Taobao trading platform owned by Alibaba Group. Employees report that they continue to work, but in a reduced regime.

In addition, after the introduction of sanctions, ZTE shares trade was frozen.

The company has a lot of loans, and in the absence of any activity, it will be impossible to repay them. Therefore, the media says that ZTE thought about selling the mobile unit. Negotiations on the deal are allegedly being conducted with Huawei, OPPO and Xiaomi.

Why did this happen

ZTE went to the bottom after the sanctions imposed in the United States. Recall that due to illegal trade with Iran and the DPRK, the company fell into disgrace with the US authorities. American manufacturers for 7 years have been banned from selling parts and software, and this is 25-30% of sets of products.

First of all, these are Google services and mobile processors from Qualcomm. And although MediaTek was allowed to supply its chipset to the Chinese manufacturer, this situation, apparently, did not save.

Source: Reuters

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