ZTE and ChinaTel’s subsidiary Perusat sign contract for supply of wireless broadband equipment and services

SAN DIEGO, USA & SHENZHEN, CHINA: ChinaTel Group Inc. (ChinaTel) announced that its subsidiary Perusat S.A (Perusat) has finalized a contract for ZTE Corp. (ZTE) to provide Perusat equipment and services for its deployment of a wireless broadband telecommunications network in Peru.

Perusat has contracted ZTE to become its exclusive supplier of infrastructure equipment, consumer terminals, and engineering and management services for the wireless broadband network Perusat is deploying in Peru. The total value of the contract is expected to be approximately $48 million over the next seven years.

The purchase orders for the first phase have a value of $6.98 million. ZTE is financing 85 percent of the cost of infrastructure equipment covered in the phase one purchase orders. National banks in China with whom ZTE has relationships are expected to finance future equipment orders, also at 85 percent.

“We are excited about our partnership with ZTE and its ability to fully deliver broadband equipment and end-to-end network solutions,” said ChinaTel’s CEO George Alvarez. “ZTE has the foresight to create equipment solutions that will migrate from the current WiMAX 802.16e protocol to 802.16m, to TD-LTE, or dual band 16m and LTE.”

ChinaTel’s president, Colin Tay, added: “Our relationship with ZTE strengthens our plan to be at the forefront of delivering advanced internet technologies across the globe as we continue to build our infrastructure in emerging markets like China and Peru.”

The first phase of deployment (initial geographic coverage in seven cities) is scheduled to be completed by approximately May 2011. Perusat’s sales and marketing effort will go hand in hand with deployment, and ChinaTel expects to have subscribers enrolled such that the technical and commercial launch of the network will occur simultaneously.

Perusat will expand capacity in each market as subscriber demand dictates. By virtue of Perusat’s status as a 95 percent subsidiary, the results of operations and subscriber revenues generated by the Perusat network will be reflected on ChinaTel’s consolidated financial statements.