BEIJING, Oct. 25 -- Alcatel SA plans to buy control of Chinese network gear supplier Shanghai Bell and consolidate China operations under it. Alcatel will pay $312 million to increase its stake in Shanghai Bell then merge all of its China operations over two years, executives said.
"It's a form of consolidation," said Alcatel CEO Serge Tchuruks.
Alcatel would buy 8.35 percent of Shanghai Bell from the Belgian government and 10 percent plus one share from China -- giving Alcatel a controlling 50 percent plus one share stake in Shanghai Bell, to be renamed Alcatel Shanghai Bell, Tchuruks said.
The Ministry of Information Industry, China's telecoms regulator, will control the Chinese stake in Alcatel Shanghai Bell, which will operate as a majority foreign-owned firm, not a joint venture.