Sanyo and Nokia announced on Tuesday that they are in talks to set up a global joint venture in CDMA mobile phones. The full details have yet to be decided but the new company would be operated with a "spirit of partnership," the two companies said in a joint statement, without revealing ownership ratios or other financial details. "The resulting company will have major operations in Osaka and Tottori, Japan and San Diego, USA," revealed the statement.

The two companies aim to sign a final agreement in the second quarter of 2006 and start operations in the third quarter, integrating their cellphone operations in the CDMA standard.

CDMA is the dominant mobile technology in North America and used by Japan's second-largest mobile operator KDDI for its main "au" brand of mobile services.

"Looking at the situation of Japanese mobile phone handset makers, we thought that it was inevitable to tie-up with a major player in the world which produces some 50 million to 60 million handsets a year," said Sanyo senior officer Takenori Ugari, who heads the company's telecom division.

In the first year, the venture aimed to achieve output of 35 million handsets or above, and ultimately reach 50 million, he said.