ZTE Corp., China's second-largest telecom equipment maker, denied Thursday a report that it was pursuing a purchase of Siemens' loss-making mobile phone handset business.

"We have no interest in the business at this time, and are not doing any assessment," a ZTE official said.

He was responding to a Wednesday report in the German media that ZTE was studying a possible purchase of Siemens' mobile phone division.

Siemens declined to comment on the report, saying it was still considering four options for the unit: selling, closing, fixing or putting it into a joint venture.

Operating losses at the unit widened in the quarter through December to 143 million euros (US$186 million) as the business suffered from a high cost base and eroding market share.

ZTE, which has shares listed in Hong Kong and Shenzhen, derives the majority of its revenue from telecom equipment. But the Shenzhen-based firm also has a sizable mobile phone unit for most of its business in China. The unit had a target of 10 million handsets for domestic sale in China last year.

The company has embarked on an aggressive campaign to boost its exports over the last two years, mostly focused on its telecom equipment business but also with some emphasis on mobile handsets.

China's top two domestic mobile phone makers, Ningbo Bird Co. and TCL Communication Technology Holdings Ltd., have both embarked on major export campaigns last year as their home market becomes increasingly saturated.

(Shenzhen Daily February 18, 2005)