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FLEX - Flex News Story

$17.59 0.1  0.5%

Last Trade - 7:06pm

Sector
Technology
Size
Large Cap
Market Cap £6.18bn
Enterprise Value £6.99bn
Revenue £17.07bn
Position in Universe 1006th / 6846

Electronics maker Flex 'seized' $100 mln of Huawei goods in China -Global Times

Thu 25th July, 2019 11:31am
By Sijia Jiang
    HONG KONG, July 25 (Reuters) - Electronics manufacturer Flex
 FLEX.O  held up goods worth some 700 million yuan ($101.85
million) of its Chinese client Huawei Technologies for more than
a month after Washington put Huawei on a trade blacklist,
China's Global Times reported on Thursday. 
    Flex kept the Huawei  HWT.UL  assets in its factory in the
southern city of Zhuhai after Washington added Huawei to an
Entity List on May 16 that prohibits U.S. firms from doing
business with it, according to the report.
    Flex, which is dual-headquartered in the United States and
Singapore and manufactures smartphone and 5G base stations for
Huawei, did not immediately respond to an email seeking comment
outside U.S. business hours and did not answer calls to its
Zhuhai office. 
    Guo Fulin, president of international media affairs at
Huawei, told Reuters the company has retrieved some 400 million
yuan of goods after negotiations with Flex last month and is
still trying to get back the rest.
    "We cannot understand why their Chinese factory seized our
goods. This is an over-interpretation of the ban," he said. 
    The Chinese newspaper said Flex has been removed from
Huawei's supply chain due to the incident that had "angered
Huawei", but Guo declined to comment on that.    
    In May, Huawei was added to the Entity List on national
security grounds which barred it from  buying U.S. goods and
services. According to a Goldman Sachs estimate https://fingfx.thomsonreuters.com/gfx/editorcharts/USA-CHINA-HUAWEI/0H001GSE93H2/index.html,
 Huawei contributed nearly 2.5 billion yuan, or 5 percent of
Flex's total revenue in the third quarter of 2018. 
    While Washington has given Huawei a temporary reprieve from
the ban and U.S. President Donald Trump signaled he could be
relaxing the curbs, it has already rattled the global technology
supply chain tied to Huawei's $105 billion business that spans
telecom equipment and smartphones.  urn:newsml:reuters.com:*:nL4N22S13G
    The ban has also caused confusion among global companies and
even academic bodies as the restrictions on their engagement
with Huawei were unclear. U.S. delivery firm FedEx  FDX.N  sued
the American government last month after the company's
mishandling of Huawei packages caused a public uproar in China.
 urn:newsml:reuters.com:*:nL2N23U020  urn:newsml:reuters.com:*:nL4N2363BB
($1 = 6.8729 Chinese yuan renminbi)

 (Reporting by Sijia Jiang; Editing by Muralikumar Anantharaman)
 ((Sijia.Jiang@thomsonreuters.com; +852 65313893;))
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