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Nokia (NOK -1.2%) and Siemens (SI -0.9%) have "intensified talks" to end Siemens' involvement in...

Nokia (NOK -1.2%) and Siemens (SI -0.9%) have "intensified talks" to end Siemens' involvement in their telecom equipment JV, sources tell Bloomberg. One scenario involves a joint buyout of Siemens' 50% stake in Nokia Siemens by Nokia and a "strategic partner" such as Alcatel-Lucent (ALU -6.4%), which is said to have "held exploratory talks" about a deal. Nokia Siemens, which is again profitable following a major restructuring, has been valued at up to €10B. ALU sold off after initially trading higher post-earnings.
Comments (15)
  • Why would Siemens want out?
    7 Feb 2013, 04:32 PM Reply Like
  • Siemens have wanted out from beginning, telecom is no longer their core holding. NSN was a way to get rid of nonperforming unit for Siemens
    7 Feb 2013, 05:15 PM Reply Like
  • It would have made more sense for Nokia to negociate this when the division was in the dumps, not now.
    7 Feb 2013, 04:35 PM Reply Like
  • Yeah was just thinking that... although maybe Siemens is strapped for cash.
    7 Feb 2013, 04:38 PM Reply Like
  • Not necessarily Paulo. If you recall they shopped this venture all over a couple of years ago as NSN required a lot of capital infusion which no one wanted to take on. NOK was not in a position to take on more problems given their own capital needs. Now that NSN has slashed costs and become rejuvenated it may be the perfect time to access the capital markets with either a debt offering or find an equity partner. In an interview on Australian TV Mr. Elop replied very abruptly went asked about NSN accessing capital markets for a Euro debt offering and said he would not respond to rumors. I thought his reaction was interesting and now perhaps we know why.
    7 Feb 2013, 05:00 PM Reply Like
  • Siemens wants out of many businesses, the Siemens exit is not based on the financial health of NSN. Siemens wants to downsize its business.

     

    The shape of ALU is not good, it has just got a loan of 1,6 Billion Euro, but NSN cannot stand another merger with another tech company. NSN has been trough a brutal cut costing program and to the success of Elop, he has managed to earn money on NSN.

     

    ALU merger was bad from the beginning, Nokia does not need this kind of trouble. http://bit.ly/12xdBl3

     

    I am sorry to say, but Nokia should buy Siemens out and let ALU ride its course.

     

    The impact on Nokia stock should Alu enter NSN, would be devastating bad for Nokia.
    7 Feb 2013, 06:01 PM Reply Like
  • I'm with you Origa, Nokia just became profitable again. Why would they even get near ALU who burns through cash worse than anyone? They should just buy out Siemens and let bygones be bygones. The only thing going for ALU is that their CEO is on his way out. The company should have been out of business a few years ago but they must have friends in high places because they get bailed out just in time... (FTE) is probably next in line for a bailout unless they cut their dividend. I'm so hesitant to go anywhere near Europe these days with the exception of NOK and (STO). The Norwegian currency in relation to the dollar has the stock at a great entry point right now, and those Norwegians seem to have a better head on their shoulders than the Euro folks. Poor Germans are just getting dragged down by their neighbors.
    7 Feb 2013, 07:52 PM Reply Like
  • Barbarians (a.k.a. Chinese companies) are at the gate of the free world. More collaboration with weak ALU makes perfect sense for NSN. Though, on a second thought, it makes not much sense for ALU.
    7 Feb 2013, 08:54 PM Reply Like
  • I long Nokia.
    8 Feb 2013, 12:28 AM Reply Like
  • Logic says Nokia will buy out Siemens. That is why Nokia preannounce earnings when stock started to fall, to protect it's ability to tap the credit market. Makes sense if NSM can be self sustaining and contribute cash flow to Nokia.
    8 Feb 2013, 12:28 AM Reply Like
  • I guess that Alu will sell its IP parts to Cisco/Juniper, some other to other takers, leave wireless intact and merger with NSN paying Siemens out.

     

    NSN gets listed. Alu gets chopped apart. Siemens get money.
    Not sure if Nokia will cashin same time or not.
    8 Feb 2013, 02:12 AM Reply Like
  • I really don't understand this move by Nokia. Instead of intensifying the talks to buy out Siemens, they should stall them. Nokia is selling assets to increase their cash and NSN is not cheap anymore after the excellent performance in Q4 2012. An alliance with ALU would be a bad sign, ALU is already several years in big trouble and almost broke.
    8 Feb 2013, 07:38 AM Reply Like
  • Geez, great timing. *SHEESH*
    8 Feb 2013, 10:46 AM Reply Like
  • Speaking of Siemens, I bought their ADR for my IRA where any foreign withholding taxes are a pure loss because one cannot itemize those on the tax returns. However, I was under the impression that there is a reciprocal tax treaty between the USA and Germany whereby the very high German withholding taxes are waived IF the assets are held in a retirement account. Well.. SI just paid a dividend and my broker did hit my account for the withholding tax. Does anyone out there know with certainty that there is a USA-Germany tax treaty that's still in effect?
    8 Feb 2013, 11:12 AM Reply Like
  • See IRS form 1116
    8 Feb 2013, 12:45 PM Reply Like
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