Nokia Oyj (HEL:NOK1V) and Siemens AG (ADR) (NYSE:SI) bond-selling for stronger business-bonds
Northern, WI 03/19/2013 (avauncer) - Nokia Oyj (HEL:NOK1V) (Current: $2.59, Up: 0.31%) and Siemens AG (ADR) (NYSE:SI) (Current:$108.85, Up: 0.39%) are seeking to make the Nokia Siemens Network a more independent venture and the latter is now selling $779 million(600 million euros) worth of bonds and has published a list that details its assets and liabilities. The Espoo, Finland-based venture said that the plan is to use the proceeds of this sale in the repayment of debt. The five year bonds will be redeemable only after two years while the seven-year notes will be non-callable for three years. In addition to this, it has listed cash and equivalents worth 2.42 billion euros at 2012 end as well as total borrowings and loans of 1.13 billion euros.
Keeping their options open
Both, Nokia Oyj (HEL:NOK1V) and Siemens AG (NYSE:SI) who have been in the partners in this venture for six years and are now looking for options. Siemens is the one who has been pushing for an exit. The unit has competitors such as Alcatel-Lucent SA, Ericsson AB, ZTE Corp and Huawei Technologies Co, the latter two of which are Asian suppliers. There has been an acceleration in talks about the units future as the shareholder agreement renewal is scheduled to come up in April said people who are familiar with the issue. Samih Elhage, the Nokia Siemens CEO said that the focus on building a sustainable and strong business will not change and the right capital structure will be created for the future.
Hopes for a bright future
Nokia Siemens had been unprofitable until early last year and its more recent earnings are a bright spot. The joint venture makes up 83 percent of the total Nokia market value which currently stands at close to 9.7 million euros. In 2011 the company had announced 17,000 job-cuts and seems to now be back on track and might end up meeting its operating expenses-cut target of 1 billion euros by the end of this year. The company has been concentrating on the wireless infrastructure, is making concentrated efforts to boost the service businesses it runs.