HELSINKI - Nokia Siemens Networks' (NSN) agreed $1.2 billion acquisition of Motorola's telecom network equipment arm has been delayed by the Chinese regulator, which has yet to grant permission for the deal, Reuters reported Thursday.

The chief executive of Nokia Siemens, Nokia's network gear unit, said he was working closely with the anti-monopoly bureau of the Ministry of Commerce of China to finalize the clearance, the report said.

The deal will strengthen Nokia Siemens -- a joint venture between Nokia and Germany's Siemens -- against its key Chinese rivals, and make it the second-largest mobile telecom gear maker ahead of China's Huawei, the report said.

Motorola and NSN have had a hard time battling bigger players to win business with large telephone companies in the cut-throat mobile gear market, which is expected by analysts to decline in 2010, the report said.

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According to the report, although Motorola has only three percent share of global mobile network market, but it gives Nokia Siemens relationships with more than 50 telecom operators and to strengthen its position with major carriers such as China Mobile, Clearwire, KDDI, Sprint, Verizon Wireless and Vodafone.

However, Motorola said the delay in unit sale will not impact its ongoing split-up.

"It will not affect the separation of Motorola, which is on schedule for Jan 4, 2011," the report cited Motorola Solutions' spokeswoman Tama Mcwhinney as saying.