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Nokia has struck a deal to sell its submarine networks business, Alcatel Submarine Networks (ASN), to the French government. Here's a breakdown of the key detai

Nokia Divests Submarine Network Business to French State

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Image credit: Ashutosh Singh Rana

Nokia has struck a deal to sell its submarine networks business, Alcatel Submarine Networks (ASN), to the French government. Here's a breakdown of the key details:

  • Acquisition by French State: The French state, represented by the Agence des participations de l'Etat (APE), will acquire ASN.
  • Deal Value: The agreement is valued at €350 million (around $374 million USD). This includes both the equity and debt of ASN.
  • Staged Acquisition: The French state will initially acquire 80% of ASN. The remaining 20% stake held by Nokia will be acquired later.
  • Deal Timeline: The sale is expected to close by the end of 2024 or early 2025, subject to regulatory approvals.

Nokia's Rationale:

  • Strategic Focus: Nokia aims to streamline its portfolio by divesting non-core businesses like ASN. This allows them to focus on core network infrastructure operations.
  • Improved Profitability: Selling ASN is expected to enhance the profitability of Nokia's Network Infrastructure business group.

Benefits for ASN:

  • French State as Stable Owner: The French government's involvement could provide stability and ensure continuity for ASN's customers, employees, and partners.

Impact on Nokia Stock:

  • The financial impact of this divestiture on Nokia's stock price is not expected to be significant.

Overall, this deal signifies Nokia's strategic shift towards core network infrastructure and potentially positions ASN for continued growth under French state ownership.

Investor Takeaway:

  • This news might be relevant for investors holding Nokia stock (NOK). However, the financial impact is likely to be minimal.
  • Investors interested in the submarine network industry might want to follow ASN's developments under French ownership.

Remember: Conduct your own research and consider your investment goals before making any decisions.

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