Nokia Corporation Stock
Exchange ReleaseMay 18, 2017 at 09:00 (CET +1)
Nokia and China Huaxin sign definitive agreements for
creation of new Nokia Shanghai Bell joint venture
Beijing, China - Nokia and China Huaxin Post &
Telecommunication Economy Development Center ("China Huaxin") today
signed the definitive agreements of the proposed integration of
Alcatel-Lucent Shanghai Bell Co. Ltd. (ASB) and Nokia's China
business. The new joint venture will be branded as Nokia Shanghai
Bell (NSB).
As a result of today's announcement, the joint venture will
become Nokia's exclusive platform in China for the continued
development of new technologies in areas like IP routing, optical,
fixed and next-generation 5G; and with the support of Nokia, NSB
will continue to look for opportunities in select overseas markets.
ASB and Nokia's China business have been effectively operating
as one entity since January 2016 when an interim operational
agreement was signed.
The closing of today's agreement, targeted to happen in July
2017, is subject to various customary administrative, legal,
regulatory and other conditions. Nokia will own 50% plus one share
of NSB, with China Huaxin owning the remainder, and the new joint
venture will have one board of directors and one management
team.
NSB will represent the major part of Nokia's overall Greater
China business and fully leverage both shareholders' strengths,
including innovation, global scale, efficiency and a deep
understanding of the local market; and with the aim of increasing
Nokia's market presence in China. It will further Nokia's strategic
goals of leading in high-performance networks with communication
service providers and expanding to new vertical markets in
enterprise, public sector, and cloud/internet companies.
NSB research and development (R&D) will be an integral part
of Nokia's global R&D community, with a total of around 16 000
personnel, including 10 000 researchers, working across six R&D
sites in China. It will maintain and further enhance Nokia's
world-class product and research capabilities in areas that include
5G, IoT and Cloud.
NSB's R&D scope and activities will be carried out according
to Nokia's applicable policies, global R&D processes and
product roadmaps. NSB will also support strategic initiatives of
the Chinese government and engage in long-term research projects
aligned with and implementing Nokia Bell Labs' Future X
Network.
Rajeev Suri, President and CEO of Nokia Corporation,
said: "Today's agreement is historic for Nokia and for China,
marking the next step of our decades-long commitment to the country
and underscoring China's leading role in developing next-generation
communication technologies. Nokia Shanghai Bell will enhance our
ability to innovate, helping us strengthen ties with communication
service providers and expand to new, fast-growing sectors in need
of high-performing networks."
Yuan Xin, General Manager of China Huaxin, said: "We are
fully confident in the new joint venture's success during the
industry transformation brought by the new technologies like 5G and
IoT. The successful combination globally and in China brings
together the leading E2E network technologies and most powerful
innovation engines from both sides. We're excited to work with
Nokia to establish a future-oriented innovative technology company,
with a win-win cooperative model for the bigger success in the new
era."
About China Huaxin
China Huaxin Post and Telecommunication Economy Development
Center is an industrial investment company that seeks long-term
commercial growth opportunities in the Information and
Communications Technologies (ICT) sector. China Huaxin has
extensive global operations and international investment
experience. China Huaxin aspires to be a competitive global
industry holding group that creates long-term value for its
stakeholders and for society as a whole by nurturing and advancing
technology innovation in the Information Industry.
www.sinohx.com
About Nokia
We create the technology to connect the world. Powered by the
research and innovation of Nokia Bell Labs, we serve communications
service providers, governments, large enterprises and consumers,
with the industry's most complete, end-to-end portfolio of
products, services and licensing. From the enabling infrastructure
for 5G and the Internet of Things, to emerging applications in
virtual reality and digital health, we are shaping the future of
technology to transform the human experience. www.nokia.com
Media Inquiries
Nokia China CommunicationsLING YiT: +86 21 38436561M: +86
18616388716yi.a.ling@alcatel-sbell.com.cn
Nokia Corporate CommunicationsT: +358 10 448
4900press.services@nokia.com
FORWARD-LOOKING STATEMENTS
It should be noted that Nokia and its businesses are exposed to
various risks and uncertainties and certain statements herein that
are not historical facts are forward-looking statements, including,
without limitation, those regarding: A) our ability to integrate
Alcatel Lucent into our operations and achieve the targeted
business plans and benefits, including targeted synergies in
relation to the acquisition of Alcatel Lucent; B) expectations,
plans or benefits related to our strategies and growth management;
C) expectations, plans or benefits related to future performance of
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changes in organizational and operational structure; E)
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regarding financial performance, results, operating expenses,
taxes, currency exchange rates, hedging, cost savings and
competitiveness, as well as results of operations including
targeted synergies and those related to market share, prices, net
sales, income and margins; G) timing of the deliveries of our
products and services; H) expectations and targets regarding
collaboration and partnering arrangements, joint ventures or the
creation of joint ventures, including the creation of the new Nokia
Shanghai Bell joint venture and the related administrative, legal,
regulatory and other conditions, as well as our expected customer
reach; I) outcome of pending and threatened litigation,
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and our ability to achieve the financial and operational targets
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assumptions and beliefs in light of the information currently
available to it. Because they involve risks and uncertainties,
actual results may differ materially from the results that we
currently expect. Factors, including risks and uncertainties that
could cause these differences include, but are not limited to: 1)
our ability to execute our strategy, sustain or improve the
operational and financial performance of our business and correctly
identify and successfully pursue business opportunities or growth;
2) our ability to achieve the anticipated benefits, synergies, cost
savings and efficiencies of the acquisition of Alcatel Lucent, and
our ability to implement our organizational and operational
structure efficiently; 3) general economic and market conditions
and other developments in the economies where we operate; 4)
competition and our ability to effectively and profitably compete
and invest in new competitive high-quality products, services,
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manner; 5) our dependence on the development of the industries in
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exchange controls, among others; 7) our ability to manage and
improve our financial and operating performance, cost savings,
competitiveness and synergies after the acquisition of Alcatel
Lucent; 8) our dependence on a limited number of customers and
large multi-year agreements; 9) exchange rate fluctuations, as well
as hedging activities; 10) Nokia Technologies' ability to protect
its IPR and to maintain and establish new sources of patent
licensing income and IPR-related revenues, particularly in the
smartphone market; 11) our dependence on IPR technologies,
including those that we have developed and those that are licensed
to us, and the risk of associated IPR-related legal claims,
licensing costs and restrictions on use; 12) our exposure to direct
and indirect regulation, including economic or trade policies, and
the reliability of our governance, internal controls and compliance
processes to prevent regulatory penalties in our business or in our
joint ventures; 13) our ability to identify and remediate material
weaknesses in our internal control over financial reporting; 14)
our reliance on third-party solutions for data storage and service
distribution, which expose us to risks relating to security,
regulation and cybersecurity breaches; 15) inefficiencies,
breaches, malfunctions or disruptions of information technology
systems; 16) Nokia Technologies' ability to generate net sales and
profitability through licensing of the Nokia brand, particularly in
digital media and digital health, and the development and sales of
products and services, as well as other business ventures which may
not materialize as planned; 17) our exposure to various legislative
frameworks and jurisdictions that regulate fraud and enforce
economic trade sanctions and policies, and the possibility of
proceedings or investigations that result in fines, penalties or
sanctions; 18) adverse developments with respect to customer
financing or extended payment terms we provide to customers; 19)
the potential complex tax issues, tax disputes and tax obligations
we may face in various jurisdictions, including the risk of
obligations to pay additional taxes; 20) our actual or anticipated
performance, among other factors, which could reduce our ability to
utilize deferred tax assets; 21) our ability to retain, motivate,
develop and recruit appropriately skilled employees; 22)
disruptions to our manufacturing, service creation, delivery,
logistics and supply chain processes, and the risks related to our
geographically-concentrated production sites; 23) the impact of
litigation, arbitration, agreement-related disputes or product
liability allegations associated with our business; 24) our ability
to optimize our capital structure as planned and re-establish our
investment grade credit rating or otherwise improve our credit
ratings; 25) our ability to achieve targeted benefits from or
successfully achieve the required administrative, legal, regulatory
and other conditions and implement planned transactions, including
the creation of the new Nokia Shanghai Bell joint venture, as well
as the liabilities related thereto; 26) our involvement in joint
ventures and jointly-managed companies; 27) the carrying amount of
our goodwill may not be recoverable; 28) uncertainty related to the
amount of dividends and equity return we are able to distribute to
shareholders for each financial period; 29) pension costs, employee
fund-related costs, and healthcare costs; and 30) risks related to
undersea infrastructure, as well as the risk factors specified on
pages 67 to 85 of our 2016 annual report on Form 20-F under
"Operating and financial review and prospects-Risk factors" and in
our other filings with the U.S. Securities and Exchange Commission.
Other unknown or unpredictable factors or underlying assumptions
subsequently proven to be incorrect could cause actual results to
differ materially from those in the forward-looking statements. We
do not undertake any obligation to publicly update or revise
forward-looking statements, whether as a result of new information,
future events or otherwise, except to the extent legally
required.
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