ZTE taps in-house executive as new CEO

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Li Ying, now a vice-president in the finance department, will take over the role of CFO while Gu Junying, a newly elected executive director on the new board, will head the company's human resources department, according to the people, who asked not to be named as the information remains confidential.

Zhang Zhenhui was one of scores of executives at China's No.2 telecommunications equipment maker ordered to leave as part of a $1.4 billion settlement deal ZTE made with the United States in June in order to end a seven-year supplier ban.

ZTE lost the deal because it is barred from buying USA technology, and Ericsson AB won the €600 million (RM2.82 billion) contract instead, people with knowledge of the matter said, asking not to be identified because it has not been announced. The statement confirmed a notice issued by BIS earlier this week.

ZTE has already paid a $1 billion fine, and has agreed to place $400 million in escrow to cover any future misdeeds by the Chinese manufacturer. It also agreed to replace its board, remove all members of its leadership at or above senior vice-president level along with any executives associated with the wrongdoing, within 30 days. Xu, a former managing director of ZTE in Germany, has been with the company since 1998.

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Xu Ziyang, president of ZTE's Telecom Cloud and Core Network product line, has been selected as the new CEO, according to people familiar with the matter. The South China Morning Post report is as yet unconfirmed, but identifies Xu Ziyang, now president of ZTE's Telecom Cloud and Core Network product line, as chief executive. It also named a new chief financial officer, and two executive vice presidents.

The Wall Street Journal reported that the move follows the resignation of ZTE's board of directors last week.

The inside of a ZTE smart phone is pictured in this illustration taken April 17, 2018.

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