Nokia Siemens Networks will acquire Nortel's key wireless assets for $650 million. The deal brings together the assets of the two companies in the field of mobile radio access, especially in CDMA, where Nortel is a leading supplier. The acquisition of Nortel's profitable CDMA business would significantly improve Nokia Siemens Networks' presence in North America and make it a leading supplier of wireless infrastructure products in the region.
NSN said the acquisition will also help it gain momentum in LTE.
The transaction would see more than 2,500 Nortel employees -- largely located in Ottawa and Dallas but also including employees in Mexico and China -- transferred to Nokia Siemens Networks. Approximately 400 of those employees are focused on LTE research and development, and would enhance the ability of Nokia Siemens Networks to provide innovation and strengthen its position in LTE, where it is already working with customers such as NTT Docomo in Japan. The support and development of Nokia Siemens Networks' existing product lines would be unaffected by this acquisition.
"This agreement provides an important strategic opportunity for Nokia Siemens Networks to strengthen its position in two key areas, North America and LTE, at a price that makes good economic sense," said Simon Beresford-Wylie, Chief Executive Officer of Nokia Siemens Networks. "It also represents stability for Nortel's existing customers and offers a great opportunity for employees to move into a stable future with an industry winner. The R&D organization in Canada would become a long-term wireless center of excellence within Nokia Siemens Networks, complementing our other global sites."
Export Development Canada (EDC), Canada's government-owned export credit agency, is supporting this transaction with a USD 300 million loan commitment.
Due to Nortel's restructuring process, the transaction is subject to the approval of the United States Bankruptcy Court and the Ontario Superior Court of Justice.
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