Nokia Siemens sells unit to Redknee Solutions

Nokia Siemens Networks, the phone-equipment venture of Nokia Oyj and Siemens AG, agreed to sell its business support systems unit to Mississauga, Ont.-based Redknee Solutions Inc. to reduce costs and focus on mobile broadband.

Redknee expects to pay $20 million in cash initially and as much as $33 million in performance-based payouts over the next 12 to 36 months, the companies said in a statement Wednesday. As many as 1,200 employees will transfer to the voice mail and billing software company, which will also acquire intellectual property, customer contracts and supplier agreements.

Nokia Siemens, based in Espoo, Finland, and Paris-based AlcatelLucent SA are among telecommunications-gear providers that are cutting jobs and costs as the slowing global economy crimps spending on mobile-network infrastructure.

In October, Nokia Siemens posted its first quarterly sales increase and profit since last year, helped by demand for long-term evolution, or LTE, networks that allow faster data speeds.

“This planned transaction supports our transformation to focus on mobile broadband,” Nokia Siemens chief executive Rajeev Suri said.

The venture said it agreed to sell its optical networks business to Marlin Equity Partners, transferring as many at 1,900 workers.

Nokia Siemens also said it will shut down its unprofitable German services unit by the end of next year.

The company said 1,000 workers will be affected by the closing of 16 sites.

Nokia Siemens said a year ago it would cut 17,000 jobs, or about 23 per cent of the total. In October, the company said it had reduced its workforce by 14,300 from a year earlier. The purchase will probably be concluded in the first half of 2013, Redknee said.