Acacia to suspend business with ZTE until ban is lifted

Acacia Communications Inc said on Tuesday its supply agreement with ZTE Corp would remain suspended until the U.S. Department of Commerce lifted a trade ban on the Chinese telecommunications equipment maker.

The Chinese company reached a $1.4 billion settlement with the Commerce Department, made public on Monday, to resume business with U.S. suppliers.

But the ban on buying U.S. parts, imposed by the department in April, will not be lifted until ZTE pays the fines and places $400 million more in an escrow account in a U.S.-approved bank.

ZTE said on Tuesday its shares would resume trading on the Hong Kong stock exchange on June 13 following its settlement with the United States.

Acacia said the settlement may ultimately allow it to resume ties with ZTE.

The U.S. company’s shares have fallen 13 percent since the ban was imposed in April.

(Source)