In New Delhi: Nokia Siemens Network (NSN) has announced plans to acquire Motorolas GSM, CDMA, WCDMA, LTE, and WiMAX wireless assets for $1.2 billion. NSN will acquire several R&D centers as part of the deal. Also, approximately 7,500 Motorola employees are expected to be transferred to NSN. The companies expect to complete the acquisition by the end of 2010, subject to customary closing conditions including regulatory approval.
Having historically been out of the CDMA business, NSN had a weak position in the US market despite some deals in the mobile core segment (such as an IMS deal with Verizon Wireless for its LTE project) and in the optical area, says Julien Grivolas, Principal analyst, Ovum.
After its failed attempt to acquire Nortels CDMA/LTE assets, Motorola was NSNs last potential target to achieve this goal. Huawei and ZTE were also in the mix but would have struggled to close such an acquisition for political reasons, Grivolas adds.
Globally, this deal is mostly about scale and reach. The deal also marks NSNs entry into the CDMA business, as well as its comeback in the WiMAX infrastructure market. Adding Motorolas wireless RAN assets which represented a turnover of $3.7 billion in 2009 will make NSN better positioned to compete against Ericsson, Huawei, and Alcatel-Lucent.
In the US, the acquisition gives NSN an immediate footprint in the wireless infrastructure business through Motorolas contracts with Verizon Wireless and Sprint for CDMA, as well as with Clearwire for WiMAX. NSN claims that it will consequently become the number three supplier instead of being number five in the US.
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