TELETRADER News

ZTE shares plunge over 38%

EPA-EFE / STRINGER

China's ZTE Corp. shares plummeted over 38% in Hong Kong on Wednesday, following Shenzhen-based tech company's deal with the United States government to pay a $1 billion dollar in penalties.

After temporarily shutting down its international operations due to US' denial of export, ZTE agreed to replace the entire board in 30 days and pay a $1 billion fine, so that its functioning could be fully restored.

US Secretary of Commerce Wilbur Ross announced last Thursday that in addition to the fine, $400 million more would be put in escrow as a precaution and "a very powerful deterrent." The deal also imposes strong American code of compliance through officials who would be monitoring and reporting to the Department of Commerce.

Breaking the News / BM