Report : Nokia Set To Buyout Siemens’ Stake In Joint Venture
Finnish handset-maker Nokia Corp. is set to buy out German engineering giant Siemens 50 percent stake in the Nokia Siemens Network B.V. joint venture for about 1.7 billion euros or $2.2 billion, according to media reports on Sunday. The deal is expected to be officially announced as early as today.
Formed in 2006, Nokia Siemens Networks operates IPTV, WCDMA refarming, mobile TV, mobile backhaul and other “behind the scenes” technologies that power our mobile internets. The deal will help Nokia in the long run due to the profitable nature of the business, especially with some drastic cutbacks in recent years to help streamline their workforce. The business is also based in Espoo, Finland, meaning those jobs should be safe from a third-party purchaser.
Siemens has been looking for an exit strategy from this joint-venture for some time and had recently announced its intent to sell off its stake earlier this year.
The talks have taken on a certain degree of urgency, apparently, because April marks the deadline for a shareholder renewal of the NSN deal.
The reported acquisition of the stake will provide Nokia full control of a company that has been improving profitability since its restructuring began. It will also provide Nokia with an additional revenue stream amid the waning demand for its mobile handsets that saw it reporting the lowest quarterly revenues in the past 13 years.