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NSN to buy Motorola’s wireless network unit

Nokia Siemens Networks agrees to acquire Motorola's wireless infrastructure unit

Nokia Siemens Networks expects to strengthen its position in the US and Japan through the acquisition.
Nokia Siemens Networks expects to strengthen its position in the US and Japan through the acquisition.

Nokia Siemens Networks has agreed to acquire Motorola's wireless network infrastructure unit for $1.2 billion in cash, and expects to complete the deal by the end of the year.

The Finland-based vendor said it expected to gain "incumbent relationships" with more than 50 operators and to strengthen its position with China Mobile, Clearwire, KDDI, Sprint, Verizon Wireless and Vodafone, bolstering its market share in the US and Japan and cementing it s position as the world's second biggest telecom infrastructure vendor after Ericsson.

Motorola's networks infrastructure business is involved in most mainstream wireless technologies including GSM, CDMA, WCDMA, WiMAX and LTE. The business is a market leader in WiMAX, with contracts in 21 countries, and is involved in CDMA in 22 countries. It also has a strong GSM presence, with more than 80 networks in 66 countries, as well as a number of LTE pilots.

Motorola will retain its iDEN business and all patents related to its wireless network infrastructure business and other selected assets, the company said.

Some 7,500 employees will transfer to Nokia Siemens Networks from Motorola when the deal closes, including research staff in the US, China and India.

Rajeev Suri, CEO, Nokia Siemens Networks, said the deal would "significantly strengthen" the company's worldwide presence, particularly in "priority regions" including the US and Japan. 

"Nokia Siemens Networks will see the benefits of a deal that is expected to enhance profitability and cash-flow and to have significant upside potential," he said.

Nokia Siemens Networks has been keen to improve its market share in the US in recent years amid increasing competition from Chinese vendors Huawei and ZTE. The vendor lost out to rival Ericsson in its bid acquire two wireless divisions from struggling Canadian vendor Nortel in 2009.

Motorola, which has experienced declining handset sales in recent years, said earlier this month that it planned to split its handset and network infrastructure divisions, which were to be listed separately on the New York Stock Exchange.

The company had planned to spin off its mobile devices and home products business into a new entity called Motorola Mobility, which would make mobile phones and home entertainment equipment including set top boxes.