Nokia roundup: India pullout threatened, Moody's downgrades debt

|About: Nokia Corporation (NOK)|By:, SA News Editor

The Indian Express reports Nokia (NOK -0.5%) sent a letter to the Indian government in June in which it declared India has become the company's "least favorable market," and threatened to shift its manufacturing activities in the country to China.

Nokia has been embroiled in a $329M tax dispute with the Indian government (was a $383M dispute before the rupee plunged) related to its Chennai facility. The government offered to settle last month.

Meanwhile, Moody's has cut Nokia's debt rating to B1, 4 notches below investment-grade. Analyst Roberto Pozzi doesn't expect Nokia to "reach break-even on a cash flow basis before well into 2014, at the earliest." S&P cut Nokia's rating to B+ last month.

The FT takes a close look at NSN (now 100%-owned), arguing it acts as a "safety net" in light of Nokia's mobile phone woes. While Nokia's Devices & Services unit posted a €32M Q2 op. loss (non-IFRS), NSN delivered a €328M op. profit.

A banker close to Nokia: "Nokia is a very pragmatic company ... They think that if they want to pull the plug on devices they can go with NSN."