Nokia Siemens Networks is selling its optical-networks business to a private investment firm.
Los Angeles-based Marlin Equity Partners will buy the NSN unit in a deal that will create an independent company with the goal of becoming a leading provider in the optical market.
Nokia Siemens says the agreement is another step in the company’s transition to specializing in mobile broadband. It’s expected to give both businesses the opportunity to concentrate investment and strategic focus on their core segments.
During 2012 Nokia Siemens Networks has made tremendous progress in the transformation of our company to being the worlds mobile broadband specialist. Our strategic focus on our core markets has enabled us to concentrate our energy and investment in areas such as LTE where we have strengthened our global leadership position,” said Rajeev Suri, chief executive officer at Nokia Siemens Networks. This transaction builds on that momentum and aims to provide a new home for the Optical Networks business with the focus, resources and strategic flexibility to address the opportunities in the optical market.”
Marlin Equity Partners, which has more than $1 billion (U.S.) of capital, has formed a new company and intends to act as a consolidator, building an industry leader in the fragmented optical networking sector.
We are making a major commitment to this sector, and have significant capital under management that we intend to use as a catalyst for consolidation,” said Nick Kaiser, a co-founder and partner at Marlin Equity Partners.
The new optical company will be headquartered in Munich, Germany, with operations around the world. It will be led by its existing management team, with Herbert Merz nominated as chief executive officer. About 1,900 employees mainly in Germany, Portugal and China from the optical business unit and related functions are expected to transfer to the new company. Related existing customer contracts are planned to be transferred.
Ovum, the technology analyst, sees this move as an opportunity for competitors.
The details of the transaction were not released, so it is difficult to gauge Marlins commitment to turning the optical business around,” noted Dana Cooperson, leader of Ovums Network Infrastructure Telecoms practice. “Competition in the market is keen; margins are under constant pressure. Competitors will take advantage of this ownership change and related confusion to gain any advantage in NSNs accounts.”
Marlin might go ahead and sell the optical business to another vendor, Cooperson added possibly Juniper Networks.
The transaction is expected to close in the first quarter of 2013. Financial terms were not disclosed.
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January 22 2019 @ 22:01:08 UTC