Nokia today announced that it was in advanced talks to purchase all of its Franco-American rival Alcatel-Lucent. “Nokia and Alcatel-Lucent confirm that they are in advanced discussions with respect to a potential full merger, which would take the form of a public exchange offer by Nokia for Alcatel-Lucent,” the company said in a statement. Also Read - Nokia Clarity, Comfort, Micro, Go Earbuds Series with ANC launched: Price, features
“There can be no certainty at this stage that these discussions will result in any agreement or transaction,” it added. Also Read - Nokia C30 budget phone launched with price under Rs 10,000: Check specs, price
The announcement came a day after reports that Nokia was in talks to acquire Alcatel-Lucent’s wireless infrastructure. Rumors have swirled since December of a possible deal between the two firms, with France’s Les Echos reporting yesterday that executives had been in negotiations since January. Also Read - Nokia XR20 rugged 5G phone launched: Check specs, price, India launch details
The purchase would represent a significant boost in market share for Nokia. The Alcatel-Lucent wireless infrastructure unit alone accounted for 36 percent of total sales for the Paris-based company in 2014, according to Bloomberg, generating 4.7 billion Euros ($5 billion) in revenue.
The deal would help Nokia bolster its mobile infrastructure business against Swedish arch-rival Ericsson, profiting from Alcatel’s position as a leading supplier of 4G and LTE mobile networks and related services.
But the Finnish market did not welcome today’s news. In Helsinki, the Nokia share was down by 6.32 percent an hour after the announcement. On the Paris stock exchange however, the Alcatel-Lucent share shot up by 12.14 percent. The Finnish company was the world’s biggest mobile phone maker for more than a decade until it was overtaken by South Korea’s Samsung in 2012.
In 2014, Nokia sold its mobile phone and tablet division to US software giant Microsoft. It has since then sat on most of the 5.4 billion Euros made from that sale. Nokia employs some 55,000 people worldwide, while Alcatel-Lucent employs almost 53,000.