CC Image courtesy of VisualBeo.
Nokia has confirmed its plans to acquire the Siemens stake in Nokia Siemens Networks in an attempt to increase profitability.
The company is to purchase Siemens’ 50 per cent stake for EUR1.7 billion (US$2.2 billion), partly funded by a secured loan.
The acquisition will give the Finnish mobile company access to Siemens’ finances at a below-estimate cost.
However, no integration of the two companies is planned, with partnerships a future possibility, Stephen Elop, chief executive officer (CEO) at Nokia, toldBloomberg.
Pierre Ferragu, analyst at Sanford C. Bernstein London, said: “With this transaction, Nokia buys itself a future, whatever happens in smartphones and feature phones.”
He added: “Nokia Siemens has a future in the network equipment world, with a streamlined operation and a number two position in a now concentrated and stable market.”
Meanwhile, Nokia reported a lowest quarterly revenue for more than 13 years for April, with a 20 per cent decline in its sale figures owed to Asian manufacturer’s Android-operated device releases.
