The NSN BallGame ...
>> Nokia may try to acquire full control of NSN
Siemens reported to be in talks to sell its stake to its Finnish partner, or to offload the whole venture to private equity firms
Caroline Gabriel
Rethink Wireless
17 June, 2013
rethink-wireless.com
The ownership of Nokia Siemens Networks has been the topic of speculation and failed deals for several years, but just as the equipment venture looks poised for turnaround, its German parent is reportedly on the brink of selling out.
Siemens is in talks with private equity firms about the possibility of selling either its 50% stake in the company, or preferably the whole venture, according to The Wall Street Journal. The German company has made no secret, in recent years, of its desire to exit the venture, which no longer bears much relation to its core businesses in segments like transport and power stations.
And it could get a better price now that the impact of NSN's dramatic reorganization, streamlining all its processes around mobile broadband and divesting many non-core units, is starting to be seen in improved finances.
Citing unnamed "people familiar with the matter", the WSJ said Siemens has been in negotiations with various PE firms, such as TPG, Blackstone Group and KKR. Its preferred option is said to be the sale of the whole JV, which analysts estimate would be worth up to $9.36bn (£6bn) if it were a public company.
That, of course, would require the agreement of venture partner Nokia, which - although it was also once keen to cash out - is now said to be keen to stay involved in the equipment market. NSN has helped it, in the past few quarters, in its own process of stabilizing its finances. Earlier this year, Nokia officials said it had improved its cash position by more than $1bn, $866m of which was attributed to NSN.
Nokia may be trying to raise the funding to buy Siemens out and take full control. The WSJ report says the vendor has been talking to Solidium, the sovereign wealth fund in Nokia's home country of Finland.
If a Nokia buy-out - or the Finnish giant's agreement to sell its stake too - proves difficult, a less likely second option would be for Siemens to sell its 50% stake alone, or to mount an IPO to generate cash from the six-year old venture.
Earlier this year, Siemens' CFO Joe Kaeser clearly signalled the firm's intentions towards NSN when he said the unit was "not a business that we have any aspirations to stay in". Leading up to April 3, the date for renewal of the NSN shareholder agreement, the German parent began seriously raising the prospect of selling out. The renewal included a clause that allows either partner to weigh up their options for the joint venture without the danger of the other one exercising a veto.
Nokia and Siemens previously tried to sell all or part of the venture to private equity firms, but the talks broke down. ###
- Eric - |
