Nokia has announced plans to buy Siemens' 50% share in their joint venture, Nokia Siemens Networks (NSN), for €1.7 billion.
The Finnish mobile phone maker is evidently doubling down on networking infrastructure and services as its handset revenues decline.
Last year, Nokia's handset sales dropped 34% to €15 billion. NSN – the world's third largest telecom equipment maker – fared comparatively better, shrinking by just 2% to €13.8 billion.
“With its clear strategic focus and strong leadership team, Nokia Siemens Networks has structurally improved its operational and financial performance,” Nokia president Stephen Elop in a statement. “Furthermore, Nokia Siemens Networks has established a clear leadership position in (4G networking standard) LTE, which provides an attractive growth opportunity.”
According to a recent note by Ovum telecoms analyst Clare McCarthy, there are 80 telcos using NSN's LTE infrastructure and services. The company also sells customer experience management (CEM) software, that McCarthy says will help telcos move their customers on their 4G services.
German engineering giant Siemens, meanwhile, is extracating itself from the telecommunications industry. "With this transaction, we continue our efforts to strengthen our focus on Siemens' core areas of energy management, industry and Infrastructure as well as healthcare,” said Siemens CFO Joe Kaeser.
The deal is expected to close in the third quarter of 2013, with the Siemens name and branding being phased out from then.