TELECOMS EQUIPMENT MAKER Nokia has bought out Siemens in their joint venture for €1.7bn.
Nokia and Siemens had been looking for a buyer for half or all of their telecoms equipment business for some time as the relationship between the two firms has been, at best, difficult. Now Nokia has paid Siemens €1.7bn to buy its 50 percent stake in the joint venture.
Nokia Siemens Networks has been competing in the lucrative telecoms equipment business but failed to make much headway against Chinese rivals Huawei and ZTE. Nevertheless, with the continued growth of 3G deployment and countries auctioning off spectrum for 4G networks, the telecoms equipment industry is still expected to see considerable growth in the coming years.
Nokia CEO and president Stephen Elop said, "With its clear strategic focus and strong leadership team, Nokia Siemens Networks has structurally improved its operational and financial performance. Furthermore, Nokia Siemens Networks has established a clear leadership position in LTE, which provides an attractive growth opportunity.
"Nokia is pleased with these developments and looks forward to continue supporting these efforts to create more shareholder value for the Nokia group."
Nokia will pay Siemens €1.2bn in cash once the deal has been concluded with the remaining €500m to be paid a year later. The firm said Nokia Siemens' CEO Rajeev Suri will continue in his role.
Nokia said Siemens' name will be "phased out" of the firm and expected the transaction to be completed in the third quarter. µ
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