Coolpad Group Ltd. (02369.HK), a Shenzhen-based wireless solution and equipment provider, is gearing up for a price war in a bid to boost its market share in the smartphone business.
The company will step up efforts on online sales while launching new aggressively-priced handsets, the Hong Kong Economic Journal reported, citing executive vice president and chief financial officer Jiang Chao.
As part of its business strategy, Coolpad has entered into an agreement with Qihoo 360 Technology Co., under which the latter will develop operating systems for Coolpad’s Dazen mobile phones.
Coolpad and Qihoo are investing US$500 million and US$410 million respectively in a joint venture company that will eventually be spun off for a public listing in five years, the report said.
Valuation is expected to be in the US$5 billion to US$10 billion range by that time.
Coolpad chose Qihoo over Alibaba Group as a partner for mobile operating system development.
Alibaba, meanwhile, partnered with Meizu Technology Co. by investing US$590 million into the phone maker and jointly developing the Aliyun OS.
Coolpad plans to sell over 15 million Dazen phones this year, compared with 4 million last year, Chao was quoted as saying in an interview.
This article appeared in the Hong Kong Economic Journal on March 30.
Translation by Vey Wong
[Chinese version 中文版]
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