Nokia
has boldly pushed ahead with its ambition to become one of the world’s
leading network equipment makers after buying French peer Alcatel-Lucent
for $16.6 billion (15.6 billion euros), the company announced today.
The combined company will be called Nokia Corporation and
be headquartered in Finland, maintaining research and development
centers in the U.S., France, Germany and China.
Nokia’s offer price represents a fully-diluted premium of
34% on Alcatel’s share price. The two companies expect the deal to close
in the first half of 2016, though the deal is still subject to approval
by shareholders and regulators.
Having sold its mobile handset division to Microsoft last
year for $7.2 billion, Nokia has since primarily focused itself on
network equipment manufacturing, mapping-and-location services and
patent licensing.
By picking up Alcatel-Lucent, with its 52,000-strong
workforce, Nokia said its new addressable market was 50% larger,
increasing to 130 billion euros from 84 billion euros.
“With more than 40 000 R&D employees and spend of 4.7
billion euros in R&D in 2014, the combined company will be in a
position to accelerate development of future technologies including 5G,
IP and software-defined networking, cloud, analytics as well as sensors
and imaging,” Nokia said in a press release Wednesday.
“Alcatel-Lucent and Nokia have highly complementary
portfolios and geographies, with particular strength in the United
States, China, Europe and Asia-Pacific.”
In addition to using some of the proceeds from its
mobile-handset business sale for the deal, it may also raise money by
selling its location and mapping business, HERE.
Nokia confirmed today that it was reviewing strategic options including the divestment of its HERE business, worth 2 billion euros according to Bloomberg.
Source: Forbes
Source: Forbes
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