Rumours intensify of a bid for Nokia
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Rumours intensify of a bid for Nokia

Last Updated: Thursday, June 20, 2013, 22:02
 
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Rumours intensify of a bid for Nokia
Helsinki: Rumours that struggling Finnish mobile phone maker Nokia may be up for sale have intensified this week, with analysts seeing three potential buyers who could be even more interested if the company undergoes a restructuring.

Independent telecoms analyst Ari Hakkarainen said he was "astonished" that Nokia had not already been snapped up.

Once the star performer on the Helsinki stock exchange, Nokia's market value has plunged 30 per cent in the past two years, dropping below USD 14.5 billion at the end of last week.

Speculation that the company could be for sale have given the share a small boost, sending its price rising 3.63 per cent today and 1.81 per cent on Tuesday.

Yesterday, the Wall Street Journal reported that US technology titan Microsoft was involved in serious talks with Nokia about taking over its mobile phone business, but the negotiations faltered.

And on Tuesday, Richard Yu, head of consumer business at Chinese rival Huawei, said in an interview with the Financial Times that his company was "open" to talks with Nokia.

Analysts suggest Chinese PC maker Lenovo could also be interested.

Speculation about a takeover of Nokia has intensified since April, when a contract committing Nokia and Siemens to their joint venture, telecoms equipment maker Nokia Siemens Networks, came to an end.

NSN has been a crucial contributor to Nokia's finances at a time when the company has been in trouble: Nokia has reported a net loss in seven of the past eight quarters amid fierce competition from Apple's high-end iPhone and Samsung's Galaxy.

"There will probably be a restructuring of NSN ... Once it is separated from NSN, Nokia would be more attractive to a buyer," Inderes analyst Mikael Rautanen said, noting that the value of a leaner Finnish company would come down further.

Pohjola analyst Hannu Rauhala, said NSN was "a separate company", while all of Nokia's other activities were "linked to one another."

Once NSN is detached from the rest, the mobile phone unit and geo-localisation services could become attractive to a buyer.

Microsoft and Nokia already joined forces about two years ago in an alliance aimed at making inroads with handsets powered by Windows Phone software.

Nokia will soon move wholly to the Windows platform, since it has now made its last phone on the Symbian operating system, the 808 PureView.

AFP



First Published: Thursday, June 20, 2013, 22:02


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