China GrenTech Corporation Ltd, a Shenzhen, China-based manufacturer of wireless telecoms equipment, plans to raise $115m in an IPO on Nasdaq.
The company said independent research has rated it the second largest provider of wireless coverage products and services in China. It said its indoor and outdoor coverage products receive and amplify signals from base stations and then transmit these signals to a designated coverage area. It also produces RF-based wireless access products, include wireless local area network products and wireless broadband access products, which it sells to equipment manufacturers and wireless communication carriers.
Most of its revenue comes from the country’s two leading wireless operators: China United Telecommunications Corp (China Unicom) and China Mobile Communications Corp (China Mobile). It said it is also exploring new business opportunities outside mainland China for its wireless coverage products and services and other RF products and has conducted preliminary negotiations with potential customers some southeast Asian countries such as the Philippines and Indonesia.
China GrenTech said a report by the PRC Ministry of Information Industry predicts that revenue for the wireless communication industry in China will grow by approximately 11.9% in 2006, 10.8% in 2007, 9.9% in 2008, and 9.0% in 2009.
There could be difficulties ahead with speculation on the future of its two main customers. This year China is to issue 3G licenses and China Grentech said that according to some commentators, the government believes that there are too many national wireless operators to receive 3G licenses.