Are Nokia and Siemens trying to wiggle out of their joint venture, Nokia Siemens Networks (NSN)?
If an unnamed insider talking to the Financial Times in Germany is correct, the answer is yes.
The problem is that few, if any, investors would be interested in buying the struggling telecom equipment maker, sources say. That’s because NSN isn’t holding up well to competitors. It’s losing ground to Ericsson – which beat out NSN for Nortel’s coveted wireless assets at auction this past summer – and low-cost rival Huawei.
In fact, the financial situation at NSN is so dire, Siemens recently warned it might have to write down its 50 percent stake in the deal. And in the third quarter of 2009, NSN reported an operating loss of 53 million euros, or $78.77 million, down from a profit of 177 million euros a year ago.
“I cannot imagine that NSN in its current state could be of any interest to a financial buyer,” an anonymous source told the Financial Times.
The newspaper also was told that Siemens, whose only remaining telecom holdings are through NSN, has wanted out of the joint venture “for some time” and now, Nokia wants out as well.
Siemens, NSN and Nokia would not comment to various media outlets.