Why Nokia is buying Alcatel-Lucent for €15bn

Here's how Nokia will use the networking giant to innovate

Nokia will acquire networking giant Alcatel-Lucent for 15.6 billion, confirming the deal a day after rumours suggested the tie-up was looming. 

"Our innovation capability will be extraordinary, bringing together the R&D engine of Nokia with that of Alcatel-Lucent and its iconic Bell Labs," said Rajeev Suri, Nokia CEO.

"We have hugely complementary technologies and the comprehensive portfolio necessary to enable the Internet of Things and transition to the cloud."

Michel Combes, CEO of Alcatel-Lucent, said the firms would lead in other areas, including ultra-broadband, IP networking and cloud applications. 

"With more than 40 000 R&D employees and spend of 4.7 billion in R&D in 2014, the combined company will be in a position to accelerate development of future technologies including 5G, IP and software-defined networking, cloud, analytics as well as sensors and imaging," the companies said in a joint statement. 

The pair of CEOs claimed the combined company will have leading positions in key markets including the US and China, while Combes also stressed that the "transaction comes at the right time to strengthen the European technology industry". 

Nokia predicted its addressable market will expand by 50 per cent, and it will save 900m annually in synergies by 2019. 

The deal is expected to close in the first half of 2016, after approval from shareholders and regulators. 

It follows Nokia's 4.6 billion sale of its handset business to Microsoft that was finalised last year, and could give it a shot in the arm as it bids to innovate to enter new markets.

Featured Resources

The complete guide to changing your phone system provider

Optimise your phone system for better business results

Download now

Simplify cluster security at scale

Centralised secrets management across hybrid, multi-cloud environments

Download now

The endpoint as a key element of your security infrastructure

Threats to endpoints in a world of remote working

Download now

2021 state of IT asset management report

The role of IT asset management for maximising technology investments

Download now

Most Popular

Do smart devices make us less intelligent?
artificial intelligence (AI)

Do smart devices make us less intelligent?

19 Oct 2020
Best MDM solutions 2020
mobile device management (MDM)

Best MDM solutions 2020

21 Oct 2020
What is Neuralink?
Technology

What is Neuralink?

24 Oct 2020