TMS - agreement with ZTE Supply Chain

It has been appointed as an agent of China’s ZTE Corp as part of a plan for the Chinese telco giant to provide financing services for information and communication technology (ICT) projects here in Malaysia.

The deal between ACE Market-listed TMS and ZTE should also pave the way for both parties to work together on future projects.

In the latest financing deal, a figure of US$1bil (RM3.16bil) is being bandied about as the amount of money that TMS will help ZTE to loan out, specifically to companies that plan to embark on ICT projects in the Iskandar region, the country’s ambitious development project in Johor.

The funds would come from ZTE’s wholly-owned subsidiary, Shenzhen-based ZTE Supply Chain Co Ltd, which has decades of experience in global integrated supply chain services.

TMS, currently (Sept 2013) in the red, could reap a net profit margin of about 15% from its role as the local partner of the Chinese giant in this financing project, that may entail TMS playing some sort of an “overseer” role of for the financing of the ICT projects.

An agreement between TMS and ZTE Supply Chain is expected to be signed in China this week. It is understood that executives of TMS are already there for this purpose.

It is believed that such a tie-up is the first of a kind for ZTE Supply Chain as its global parent company seeks to gain entrance into the Malaysian market and its surrounding Asean neighbours, hungry for telecommunication networking equipment and consumer products like smartphones.

Currently (Sept 2013), the ZTE group has a presence in the Malaysian market, with DiGi.Com Bhd being one of its major clients for network solutions. It has also teamed up with a local firm to sell telco devices in Malaysia.

For TMS, this partnership with the ZTE group will see its profile enhanced; this could pave the way for more jobs for it both here and abroad.