Report: Nokia Siemens parents could use Alcatel-Lucent to exit JV

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Nokia (NYSE:NOK) and Siemens are intensifying their talks to exit their Nokia Siemens Networks joint venture, according to a Bloomberg report, which cited unnamed sources familiar with the matter.

The report said one plan that is being negotiated right now is to have Nokia buy Siemens 50 percent stake in the company along with a strategic partner such as Alcatel-Lucent (NASDAQ: ALU), which has held exploratory talks on the matter. Though the talks have accelerated because of an April deadline for a shareholder renewal of NSN, the report cautioned that a deal may not happen anytime soon.

Representatives from Nokia, Siemens and Alcatel-Lucent declined to comment, according to Bloomberg.

The timing of the negotiations is curious, given the financial state of the parties involved. Though Siemens has expressed interest in exiting NSN, Nokia is still struggling with its turnaround. Nokia posted a $269 million net profit in the fourth quarter, but it remains unclear whether Nokia's embrace of Microsoft's (NASDAQ:MSFT) Windows Phone platform will help it regain its former handset glory. Meanwhile, Alcatel-Lucent just posted a $1.85 billion net loss for the fourth quarter and said CEO Ben Verwaayen will step down.

Meanwhile, Nokia Siemens reported a record operating margin and surging sales and operating profit in the fourth quarter as its strategy of cutting jobs and units not related to mobile broadband begins to pay off. Last month Nokia CEO Stephen Elop said NSN "had a tremendous and successful 2012," but he also said that Nokia is open to "all options" for NSN, according to Reuters.

Reports in January from Bloomberg and the Financial Times said Nokia Siemens may sell bonds soon , which could be used to gauge market interest in the company. While the FT said the sale could fetch around $930 million, Bloomberg put the figure closer to $1 billion.

Nokia and Siemens each contributed around $668 million to NSN in September 2011, and NSN has said it does not expect any more cash injections from its parent companies.

For more:
- see this Bloomberg article

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