Nokia’s shares rally on takeover speculation
Nokia’s share price rallied to €3.19 per share, as speculation over a possible takeover mounted
Shares in telecoms equipment vendor Nokia rallied over the weekend as speculation over an impending takeover bid for the Finnish firm mounted over the weekend.
Nokia’s stock rose by around 4 per cent on Friday, as news emerged that the firm had hired Citi Group to concoct a strategy to defend it against a hostile takeover bid from an unnamed source.
Nokia’s share price has plummeted over the past 12 months, as the company lost significant ground on its rivals Ericsson and Huawei in the 5G race. On the 24th April 2019 Nokia’s stock stood at €5.16 per share. Since then it has nosedived to a low of €2.20 in mid-March before rallying slightly to €3.19 today.
Earlier this year, US President Donald Trump stated that US firms should consider investing in controlling stakes in European tech vendors, in an attempt to challenge market leader Huawei’s dominance in the 5G space. It remains unclear whether the latest takeover rumours concern a US investor.
A report from Bloomberg in February suggested that Nokia was exploring a number of strategic options to try and lift its ailing share price, including a range of divestments. The report also claimed that Nokia would consider potential mergers for its non-core business units.
Any attempts to merge Nokia with an existing tech vendor would probably struggle to gain regulatory approval, meaning that an outright buyout could be the more likely option.
Nokia is valued at around $17 billion.