(Bloomberg) -- China’s Huawei Technologies Co. just won a major seal of approval from one of Germany’s biggest telecom companies.

Telefonica SA’s German unit picked Huawei and Finland’s Nokia Oyj to supply its fifth-generation mobile phone network upgrade, the company said Wednesday.

The announcement is a boon to Huawei after Deutsche Telekom AG said last week it has stopped ordering new 5G equipment because of political uncertainty over Chinese suppliers. Huawei has repeatedly denied allegations its equipment could be used for espionage.

The German government is currently drawing up security guidelines for the country’s 5G network expansion, in a move that’s expected to require certification of equipment such as antennas and base stations.

Huawei and Nokia will supply the radio access network in equal parts because they’re “proven strategic partners,” Telefonica Deutschland Holding AG said in a statement on its website.

The cooperation with both firms “will be subject to the successful safety certification of the technology and the companies,” the company said. “Telefonica Deutschland is taking into account the ongoing political process of establishing these security guidelines without delaying the start of the 5G expansion.”

The company’s shares fell 3.8% at 9:09 a.m. in Frankfurt after the company said in a separate statement that it would cut its 2019 dividend to 17 euro cents a share from 27 euro cents.

To contact the reporter on this story: Stefan Nicola in Berlin at snicola2@bloomberg.net

To contact the editors responsible for this story: Rebecca Penty at rpenty@bloomberg.net, Jennifer Ryan

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