Nokia to Buy Alcatel-Lucent, Merge in 2016

24 April 2015—Telecom equipment company Nokia (Finland) announced on 15 April the intention to combine forces with Alcatel-Lucent (France), its smaller rival 4G and LTE mobile network equipment supplier. Nokia will offer Alcatel-Lucent shareholders 0.55 new Nokia shares for every Alcatel-Lucent share, which is expected to value the transaction at €15.6 billion.

Nokia and Alcatel-Lucent are two of the largest providers of 4G network infrastructure equipment, along with Huawei and Ericsson. The move is expected make Nokia the largest global networking equipment company in the world when it closes in the first half of 2016.

Analysts say the move could mean the new larger Nokia will lose momentum with clients such as Verizon and AT&T, as has occurred in previous mergers as competitors aggressively pursue customers during the transition. But chief executive officer Rajeev Suri assured investors that merging product lines requires more simple software swapping than equipment changes with today’s open interfaces, 4G technology and cloud computing.

Nokia divested its Devices & Services business that provided mobile devices to Microsoft in a transaction completed a year ago.