Business

Thursday November 19, 2009

Axiata in strategic tie-up with Huawei


KUALA LUMPUR: Axiata Group Bhd has entered into a memorandum of understanding (MoU) for a strategic partnership with giant telecom equipment maker Huawei Technologies Co Ltd to search for optimal and mutually beneficial solutions.

In a filing with Bursa Malaysia yesterday, Axiata said the MoU was signed for the proposed collaboration to explore innovative solutions in areas of innovation, procurement and financing.

Meanwhile, PT Excelcomindo Pratama Tbk (XL) of Indonesia, which is a unit of Axiata, has received shareholders approval at an EGM to issue rights issue to raise some US$300mil to reduce borrowings and improve its capital structure.

“The Axiata-Huawei strategic cooperation will also have the added benefit of realising business efficiencies and competitive advantage through cashflow improvement, risk sharing and timely purchasing.

“In addition, the collaboration with Huawei, particularly on the financing facilities, would enable Axiata to gain a competitive advantage from having access to financing facilities of lower financing cost, innovative financing structures and flexible financing tenure,” Axiata said in a statement.

The telco said the partnership would streamline Axiata’s procurement process by using global frame agreements between Huawei and the Axiata group which would govern the supply of products and services by Huawei.

It added that the MoU was also to look into arranging financing options such as export credit agency backed facility, vendor financing facility, fixed term non-cancellable lease structure and direct loan facility at favourable financing terms for procurement of equipment by Axiata from Huawei.

Axiata said the non-biding MoU was valid for a period of two years unless mutually terminated.


AXIATA : [Stock Watch] [News]


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