Chinese telecommunications equipment manufacturer ZTE has entered into litigation against SA’s ZTE Mzansi (in which ZTE has a minority shareholding) over ZTE Mzanzi’s interdict against Telkom SA’s network overhaul.
Telkom was forced to stop its planned R13 billion network overhaul after infrastructure provider, ZTE Mzansi, won a court order on Friday, 30 March 2012, to halt the project.
ZTE Mzansi took Telkom to court after being disqualified from a bidding process related to the project.
In an unexpected turn of events, China’s ZTE Corp has now moved against its partner company with a Pretoria high court case to have the order overturned.
ZTE South Africa CEO, Cris Fuentes said that the new court case was brought against ZTE Mzansi because the company had engaged in litigation against Telkom SA without consulting the group – an action which Feuntes said is “contrary to the agreement” entered into by the partnership.
The CEO stressed that the ZTE Mzansi versus Telkom case had nothing to do with ZTE.
Fuentes added that, as a result of ZTE MZanzi’s actions, ZTE would be “reconsidering” their relationship with the company, but hopes to “resolve the matter amicably,” he said,
ZTE gave no indication as to how long the “reconsideration” process would take, or what the results thereof would be, but said that the company would follow South African regulations and the guidelines of the court in the process.
ZTE official statement
In a press statement today (16 April 2012) ZTE (H.K.) Ltd and ZTE Corporation have distanced themselves from Telkom network overhaul court proceedings.
The press statement is provided below.
A number of newspaper reports have linked ZTE (H.K) Ltd, ZTE Corporation and ZTE SA in ZTE Mzanzi (Pty) Ltd’s court interdict action against Telkom, Huawei and Alcatel-Lucent in respect of Telkom’s R13 billion network over-haul.
ZTE (H.K.) Ltd wishes to place on record that it is a minority shareholder in ZTE Mzanzi (Pty) Ltd and that the legal proceedings against Telkom, Huawei and Alcatel-Lucent in respect of Telkom’s R13 billion network over-haul are not supported by ZTE (H.K.) Ltd and ZTE Corporation as a strategic supplier and brand licensor. These legal proceedings were instituted without ZTE (H.K.) Limited’s approval and without the approval of its representative on the board of ZTE Mzanzi (Proprietary) Ltd.
ZTE (H.K.) Ltd and ZTE Corporation have instructed Bowman Gilfillan Inc. Attorneys to apply to the High Court to set aside the interdict referred to above and to prevent the continuation of the alternative dispute resolution mechanism in respect of Telkom’s R13 billion network over-haul and its immediate implementation by Huawei and Alcatel-Lucent.
ZTE (H.K.) Ltd, ZTE Corporation and ZTE SA therefore distance themselves from the legal proceedings against Telkom, Huawei and Alcatel-Lucent.