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Finnish telecom company Nokia has decided to buy French telecom firm Alcatel Lucent for an estimated US$16.6bn
The two companies have signed an MoU to create a new company, which will be a next-generation technology and services company for a better connected IP world, said Nokia in a statement.
The Board of Directors of both companies have approved the terms of the transaction, which is expected to be closed in the first half of 2016. However, the proposed transaction is subject to approval by Nokia shareholders and other relevant organisations, added Nokia’s statement.
Nokia president and CEO Rajeev Suri said, “Together, Alcatel-Lucent and Nokia intend to lead in next-generation network technology and services, with the scope to create seamless connectivity for people and things wherever they are. We have hugely complementary technologies and the comprehensive portfolio necessary to enable the Internet of Things and transition to the cloud. We will have a strong presence in every part of the world.”
According to the Finnish company officials, the new entity will strive to supply seamless connectivity, through the latest technologies provided by Alcatel Lucent’s Bell Labs, Nokia’s FutureWorks as well as Nokia Technologies.
There will be around 40,000 R&D employees in the new company, who will all aim to accelerate development of future technologies such as 5G, IP and software-defined networking, cloud analytics as well as sensors and imaging.
Alcatel Lucent CEO Michel Combes added, “A combination of Nokia and Alcatel-Lucent will offer a unique opportunity to create a European champion and global leader in ultra-broadband, IP networking and cloud applications. I am proud that the joined forces of Nokia and Alcatel-Lucent are ready to accelerate our strategic vision, giving us the financial strength and critical scale needed to achieve our transformation and invest in and develop the next generation of network technology.”