IBM China, Great Wall Join Forces to Supply Nokia

SEOUL (08/22/2000) - IBM China Co. Ltd. and Great Wall Shenzhen Co. Ltd.

Tuesday announced plans to invest US$25 million to establish a new jointly-owned company that will make circuit boards for Nokia Corp.'s mobile phone and systems manufacturing operations in China.

Beijing GKI Electronics Co. Ltd. is the fourth joint venture formed by IBM China and Great Wall. It will be 70 percent owned by IBM China, with Great Wall Shenzhen holding the remaining 30 percent stake, the companies said in a statement.

"For us, this is quite big news," said IBM Asia Pacific spokeswoman June Namioka. "IBM China is headquartered in Beijing, but we have never had a manufacturing facility in Beijing."Manufacturing operations are expected to begin in January 2001 at a new factory at the Xingwang (International) Industrial Park in the Beijing Economic-Technological Development Area. At present, IBM is transferring technology from an existing circuit board manufacturing joint venture it operates with Great Wall in Shenzhen to the new Beijing plant.

"We already have the facilities, and we just need to install the equipment," said Namioka. "The hiring is going to be the toughest thing we need to do, but we have already started the hiring process, and we are targeting to have 1,000 people at the company by June next year."The Xingwang park was founded partly by Nokia and is intended to become a base for the company's manufacturing operations in China. Beijing GKI Electronics will be the first company to begin production at the park, but more are expected to follow -- both Nokia's own manufacturing operations and those of partners.

For the future, the new joint venture could also possibly produce more than just boards for Nokia, said Namioka. "The actual contract does not limit us to serving Nokia," she said, leaving open the possibility that in the future, as extra capacity is added, the company could produce boards and components for other companies.

Beijing GKI Electronics is similar to an existing venture, Shenzhen GKI Electronics Co. Ltd., that produces printed circuit boards for PCs. The other two joint ventures formed by IBM China and Great Wall are: International Information Products (Shenzhen) Co. Ltd., a PC manufacturer; and Shenzhen Hailiang Storage Products Co. Ltd., a storage products manufacturing company.

Espoo, Finland-based Nokia's largest manufacturing operation in China is a joint venture called Beijing Nokia Mobile Telecommunications Ltd. The company is scheduled to become the first to settle in the Xingwang park.

IBM China, in Beijing, can be contacted at +86-10-6539-1188 or via the Web at http://cn.ibm.com/. Great Wall, in Beijing, is at +86-10-6201-1223 or at http://www.greatwall.com.cn/.

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