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Nokia Siemens Networks buys Motorola assets

Posted: 21 Jul 2010 ?? ?Print Version ?Bookmark and Share

Keywords:wireless? network? infrastructure?

Nokia Siemens Networks will purchase the wireless network infrastructure of Motorola Inc., the two companies announced in a joint statement. The transaction, involving $1.2 billion in cash, is expected to be complete by the end of the year, subject to customary closing conditions including regulatory approvals.

The transaction is expected to significantly strengthen Nokia Siemens Networks' presence globally, particularly in the United States and Japan. Through it, Nokia Siemens Networks is targeting incumbent relationships with more than 50 operators, enhancing the company's position in key wireless technologies and giving it a large global footprint in CDMA.

Motorola will retain the iDEN business, substantially all the patents related to its wireless network infrastructure business, and other selected assets.

Rajeev Suri, CEOof Nokia Siemens Networks, explained that "This is an exciting acquisition that I believe has significant benefits for customers, employees and our shareholders ... Motorola's current customers will continue to get world-class support for their installed base and a clear path for transitioning to next generation technologies while employees will join an industry leader with global scale and reach. Nokia Siemens Networks will see the benefits of a deal that is expected to enhance profitability and cash-flow and to have significant upside potential."

Greg Brown, Co-CEO of Motorola commented, "This is great news for our customers, our investors and our people and will allow us to sharpen our strategic focus on providing mission and business critical solutions for our government, public safety, and enterprise customers."

Advantages gained

As part of the transaction, Nokia Siemens Networks expects to gain incumbent relationships with more than 50 operators and to strengthen its position with China Mobile, Clearwire, KDDI, Sprint, Verizon Wireless and Vodafone.

Nokia Siemens Networks expects that based on revenue, with the addition of the Motorola wireless network infrastructure business, it will become the No. 3 wireless infrastructure vendor in the United States, the No. 1 foreign wireless vendor in Japan, and strengthen its current No. 2 position in the global infrastructure segment.

Motorola's networks infrastructure business provides products and services for wireless networks, including GSM, CDMA, WCDMA, WiMAX and LTE. This business is a market leader in WiMAX, with 41 contracts in 21 countries; has a strong global footprint in CDMA with 30 active networks in 22 countries; and a robust GSM installed base, with more than 80 active networks in 66 countries; and excellent traction with LTE early adopters.

Approximately 7,500 employees are expected to transfer to Nokia Siemens Networks from Motorola's wireless network infrastructure business when the transaction closes, including large research and development sites in the United States, China and India.

The companies expect to complete closing activities by the end of 2010 and therefore do not expect the transaction to have any impact on Nokia Siemens Networks' financial performance in 2010.

Nokia Siemens Networks and Motorola also are exploring a global relationship in the public safety arena. This relationship would combine Motorola's leadership in providing solutions to public safety organizations with Nokia Siemens Networks' commercial LTE solutions.

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