Nokia to buy Siemens’ stake

Enterprise - - INTERNATIONAL NEWS -

Nokia has agreed to buy the Siemens’s half of a telecom­mu­ni­ca­tions equip­ment joint ven­ture for about 1.7 bil­lion eu­ros ($2.2 bil­lion) as Nokia con­tin­ues to strug­gle with chal­lenges in its core busi­ness.

Once the reign­ing hand­set maker, Nokia has failed to main­tain mar­ket share, par­tic­u­larly for smart­phones, in the face of com­pe­ti­tion from Ap­ple’s iPhone and a tide of phones from Samsung and oth­ers that run on Google’s An­droid op­er­at­ing sys­tem.

By ac­quir­ing the 50 per­cent stake in Nokia Siemens Net­works (NSN) that it does not al­ready own, Nokia has se­cured own­er­ship of a prof­itable busi­ness to prop up its bal­ance sheet, as it con­tin­ues ef­forts to turn­around its cell­phone op­er­a­tions.

Un­der the terms of the deal, Nokia would pay 1.2 bil­lion eu­ros to Siemens for the joint ven­ture, and 500 mil­lion eu­ros in the form of a se­cured loan from the Ger­man com­pany that must be re­paid one year af­ter the trans­ac­tion is com­pleted.

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