Elcoteq Chooses New Asian Strategic Partner in Equity Process

Elcoteq SE announced on July 22 that it has signed a conditional Letter of Intent with Chinese industrial company Shenzhen Kaifa Technology Company Limited. After mutual re-assessment, the parties have concluded that the sufficient prerequisites for entering into a definitive agreement will not be met and negotiations concerning an equity investment have ended.

Instead, Elcoteq has signed a non-binding Letter of Intent with another Asian strategic investor. This transaction aims at strengthening Elcoteq's financial position and it also offers clear business synergies.

The Board of Directors has given authorization to proceed with the due diligence and final contract negotiations with the new investor and the parties are aiming at a rapid process to conclude the negotiations. The company will disclose further details, including the anticipated transaction timetable and the name of the new investor, within one week.

Elcoteq and the new investor proceed with the negotiations regarding the debt restructuring as previously announced. Successful senior and subordinate debt restructuring is also a precondition for concluding the definitive agreement with the new investor.

www.elcoteq.com