Nokia to buy-out Siemens’ portion of Nokia Siemens Networks

Nokia to buy-out Siemens’ portion of Nokia Siemens Networks
With an expected announcement tomorrow, Nokia plans to buy the 50% of its Nokia Siemens Networks venture from Siemens for an unspecified amount under €2 billion ($2.6 billion), using a bridge loan to finance the deal.

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. Nokia Siemens Networks was formed in 2007 and was largely unprofitable until this past year, which is an accomplishment when you consider what the industry has been through over the past few years.

Nokia Siemens Networks makes telecom gear which enables wireless networks and the internet itself to function on a daily basis. Recently it exited the WiMAX area since that standard has failed to gain much traction. Its products are geared for commercial and industrial applications, with several wireless carriers being a customer of Nokia Siemens Networks.

If this news holds up, it would explain the call to convene Nokia’s Board of Directors this past Wednesday, which had many of us wondering what the gang in Espoo, Finland were working on.

source: Bloomberg

UPDATE: Nokia formally announced that it will indeed be buying out the portion of NSN it does not already own from Siemens for €1.7 billion, of which €1.2 billion will be in cash, the remaining €500 million will be paid in the form of a secured loan to Siemens, due one year from the closing of the deal, expected to be final sometime in the third quarter of 2013.

source: Nokia


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