Business · Companies · 14 hrs ago
ZTE weighs $5.6 billion joint venture for smartphone business
ZTE is considering putting its consumer smartphone operations into a joint venture with a major Chinese internet company and Shanghai state-owned investors.
The proposed business is valued at about 40 billion yuan, or $5.6 billion, and the internet company may contribute about $1.1 billion.
The deal would cover ZTE’s mainstream phones in China and international markets, but not amount to a sale of all of ZTE.
RedMagic gaming phones, routers and home devices are expected to stay outside the arrangement.
ZTE set up a wholly owned Shanghai subsidiary in April 2025, and smartphone staff have reportedly moved there; it could become the joint venture’s operating vehicle.
The partners are still negotiating the valuation, ownership split and deal structure, and the internet company has not been identified.
An announcement was reportedly planned for late October but has been delayed, so the deal’s final terms and timing remain unclear.
ZTE is reportedly considering moving its consumer smartphone operations into a joint venture valued at about 40 billion yuan, or $5.6 billion.
The proposed partners are ZTE, an unnamed Chinese internet company and Shanghai state-owned investors.
The internet company is reportedly prepared to contribute about 8 billion yuan, or $1.1 billion, but the valuation and ownership terms remain under negotiation.
The venture would cover ZTE’s mainstream consumer smartphones in domestic and international markets, while its RedMagic gaming phone business would stay outside the deal.
Routers and home terminal devices are also expected to return to ZTE’s parent company.
- Who
- ZTE, an unnamed Chinese internet company and Shanghai state-owned investors are reportedly involved.
- What
- They are considering a joint venture for ZTE’s consumer smartphone operations, valued at about 40 billion yuan.
- When
- Discussions reportedly began in April 2026 and regained momentum in July. An announcement planned for late October was delayed.
- Where
- The venture would cover smartphone operations in domestic and international markets. The proposed subsidiary was established in Shanghai.
- Why
- The arrangement could provide financial and strategic support for ZTE’s consumer smartphone operations while letting the parent company focus on other businesses.
This story does not have two clearly opposing sides.
ZTE established Shanghai Shenqi Jiyuan Intelligent Terminal Co., Ltd. as a wholly owned subsidiary.
Discussions about the proposed joint venture reportedly began.
The discussions reportedly gained momentum again.
The parties reportedly settled on a broad cooperation model.
An announcement was initially planned but was apparently delayed.
- Proposed venture value
- About 40 billion yuan (approximately $5.6 billion)
- Internet company contribution
- About 8 billion yuan (approximately $1.1 billion)
- RedMagic
- Gaming smartphone business would remain outside the deal
- Excluded products
- Routers and home terminal devices are expected to return to ZTE’s parent company
- Subsidiary
- Shanghai Shenqi Jiyuan Intelligent Terminal Co., Ltd.
- Transaction status
- Valuation, equity distribution and structure remain under negotiation