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Nokia and Siemens in Network Deal |
PeterKay
Joined: Jul 08, 2003
Posts: > 500
From: The Ummah
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Nokia and Siemens are to merge their mobile and fixed-line phone network equipment businesses to create one of the world's biggest network firms. Both companies will have a 50% stake in the infrastructure company, to be based in Nokia's home country of Finland.
The firms predict annual sales of 16bn euros ($20.2bn; £11bn) and cost savings of 1.5bn euros a year by 2010.
The move follows a tie-up between French phone equipment firm Alcatel and US company Lucent Technologies.
The new business, made up of Siemen's networks business group and Nokia's carrier-related operations, will be called Nokia Siemens Networks.
In a statement the firms said the company would have "a world-class fixed-mobile convergence capability, a complementary global base of customers, a deep presence in both developed and emerging markets and one of the industry's largest and most experienced service organisations".
It is to be run by Simon Beresford-Wylie, currently the boss of Nokia Networks.
The Wall Street Journal put the value of the deal, due to be completed by January 1 next year, at about 25bn euros.
There has been a move towards consolidation in the telecommunications infrastructure industry, largely because of low-price competition from Asia.
Analysts said it was a deal with long-term benefits.
"If Nokia wants to be significant player on the networks side, a move like this was expected and they had to do it," said Jari Honko of EQ Bank.
"In the longer perspective it's positive, but in the short term... integration of the units could be a painful process."
Annual savings will come from areas such as research and development costs.
The new firm will be one of the world's biggest phone equipment networks.
Analyst Ed Snyder of Charter Equity Research said the deal would have implications for the 60,000 staff employed by the companies.
"The merger gives Nokia and Siemens scale they couldn't get otherwise," he said.
"You're going to be able to get rid of a lot of people, basically. They share common markets."
Taken via BBC News
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[ This Message was edited by: PeterKay on 2006-06-19 08:29 ] | |
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*Jojo*
Joined: Oct 15, 2003
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@peter - Nice report pal ! I think this will be a BIG disadvantage to Nokia . . . as they can still LEAD the pack in the what, say 5-10 years ! Let's just hope that it will be a GOOD move for Nokia, for Siemens it's sure is a GOOD 'deal' as they are not doing that GOOD : profit earnings . . . i hope that POSITIVE results will be seen fast . . as just what happened to  when Sony and 'Bobafett' merged  !
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JK
Joined: Feb 24, 2005
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From: S. Africa - JOZI
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So Siemens merged with Benq and now the network side has joined Nokia?  |
*Jojo*
Joined: Oct 15, 2003
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Maybe Siemens will merge with too . . . for what purpose then 
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mario2002
Joined: Feb 15, 2004
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From: Jeffrey's-Bay ,South Africa
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I don't think so. SE is too small to attract any big merger. It will be more like buying and Sony obviously won't let that happen. After all they are doing ok and there is no point in selling. (althou Ericsson does't seem to care much). Nokia is getting to big for my liking. They already rule the cell market (every 3-th cell ever sold is a Nokia) and now they want to get networking too (ericsson is the 'boss' there - for now). I prefer 'dog eats dog' :) I don't like monopolies. Greetings from South AFRICA . Mario
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Posted: 2006-06-19 09:28
