Nokia puts $6.8M into China’s KongZhong

Nokia Growth Partners announced a non-binding deal to back China’s KongZhong Corp. with $6.8 million in five-year convertible senior notes.
KongZhong offers games and other content to Chinese users through the wireless Web and other distribution channels, and – like other content providers – has struggled in recent years with the country’s crackdown on digital retailers. The company last week posted a net income of $520,000, down from $690,000 during the year-ago period, and recently cut its staff by roughly 10%.
Nokia’s venture arm also said the agreement includes rights to purchase an additional 2 million shares of the Nasdaq-traded firm at $5 per share within five years.
“KongZhong is a premier mobile entertainment company,” said Paul Asel, managing partner of Nokia Growth Partners, in a prepared statement. “Our investment reflects the belief in the leading role KongZhong can take as China embarks on 3G mobile services.”