Siemens has paid BenQ to take on its loss-making mobile division. Under the terms of the agreement the German company will pay BenQ €250m to take the division off its hands.

A Siemens spokesperson said that the money will be ring fenced for use within the mobile division, and that Siemens has also agreed to spend €50m buying BenQ shares.

"We are entering a win-win business," claimed Klaus Kleinfeld, chief executive at Seimens. "BenQ is already positioned in the turbulent consumer segment."

The deal, which will be completed by October, will see BenQ taking over all equipment, manufacturing and R&D facilities, as well as intellectual property rights, of the Siemens mobile division. It will make BenQ the world's fourth biggest mobile handset manufacturer.

"With the acquisition of Siemens' mobile phones business, we are rapidly approaching our goal to become one of the world's leading players in the mobile phone industry," said BenQ chairman K Y Lee.

Siemens shares rose on news of the deal. The mobile phone division has lost €280m in the past six months.