Thomson buys Nokia's China TV stake

Rico Ngai

SHENZHEN: French electronics maker Thomson, said it will buy out most of the stake held by the world's top cellphone maker, Nokia, in a joint venture making set-top TV boxes for the China market.

Thomson did not say how much it is paying for the stake, but a spokesman described the investment as "strategic" and not a major financial commitment.

Following the purchase, the venture's name will change to Thomson/Citic Digital Technology from its current name, Nokia/Citic Digital Technology, Thomson said in a statement.

It said the deal is expected to close in September.

The announcement comes two months after Motorola Inc., the world's No. 2 cellphone maker, said it would spend up to $33 million to take as much as a 30 percent stake in DVN Holdings Ltd., a Hong Kong-listed company making set-top boxes for the China cable TV market.

Motorola completed its purchase of an initial 11.34 percent stake earlier this month for about $7.5 million.

It has billed the purchase as a strategic move, bringing together its digital hardware expertise and distribution channels in China with DVN's expertise in digital cable software and Chinese industry connections.

More than 100 million Chinese now subscribe to cable TV with most, receiving older analogue service. But the nation's TV regulator has announced ambitious plans to migrate 30 million users to digital service in the next few years, with analogue service to be cut off completely by 2015.

DVN, which puts its China market share at 50 percent, estimates 250,000 digital set-top boxes have been sold in China to date, including about 100,000 in the first half of this year.