Huawei inks multi-million dollar deal with NZ firm

Auckland based frequency control solutions manufacturer Rakon announced [PDF] yesterday that it has signed a deal with global Chinese telco and network vendor Huawei worth US$56 million (A$53.6 million) over five years.

Huawei will use Rakon's frequency control products its handsets and other smart devices, according to a letter of intent between the two companies.

The deal was brokered by the the New Zealand minister of trade, Tim Groser during a trade mission to China last year and the letter of intent will be signed in Wellington by Huawei's deputy chairman Ping Guo and president of global procurement, Fuhai Yao.

Listed on the NZX with offices in NZ, UK and France, Rakon makes quartz crystals and different types of oscillators for frequency control solutions used in range of civilian radio and global positioning system (GPS) applications.

The company ran into controversy in New Zealand in 2006, after it was revealed to have supplied Rockwell Collins which in turn makes targeting and communications systems for guided munition and missiles for the United States military.

Its share price has dropped from a high of NZ$5.80 in 2007, and is trading around NZ$0.50 (A$0.38) currently.