Boston, MA, 11/14/2013 (wallstreetpr) – After a lengthy period of transformation efforts, Nokia Corporation (ADR) (NYSE:NOK) is now seeking to expand its horizon in telecoms equipment business. Nokia Solutions and Networks (NSN) has been concentrating on cost-cutting efforts while avoiding unprofitable businesses for many years. The cost reduction efforts saw the unit layoff nearly a quarter of its workforce. Through cost-cutting and ditching of unprofitable contracts, the company has now got back on its feet in terms of finances. It is also having good cash from the sell of its handset business to Microsoft. In this situation, the unit’s CEO Rajeev Suri says that his focus now is to expand the unit.
One possible expansion avenue according to Suri is to go for the smaller rivals in acquisition deals. The possible immediate target for Nokia’s network unit is thought to be the wireless business of the embattled French rival Alcatel-Lucent. However, the company would not be in an all-out war to takeover its weaker rivals. This is why the CEO says that he would still scan the market to see what is available. But even as NSN seeks to expand its business to turn more profitable, going into deals for the sake of it could prove counter productive. This is why the company stated it would be led by the market forces in reaching a decision on how best to go about its expansion efforts.
At the moment, NSN accounts for more than 90% of Finnish company’s sales, considering that its handset business had already turned into a burden – minting losses quarter in quarter out. For six straight quarters now, up to the most recent one ending Sept., NSN has been making profits after it got its act in order.
NSN is now seeking business with Vodafone for its $11.2 billion high-speed wireless network. The unit expects that a deal with the UK’s leading mobile operator will open up more contracts in Europe. Its eyes are also set on South Korea and Japan as the nation’s carriers seek to upgrade their wireless network infrastructure. The unit is also seeking for more network upgrade business in the U.S. after signing a successful deal with Sprint.
