Analyst: NSN merger with Juniper Networks would make sense

A merger between Nokia Solutions and Networks (NSN) and Juniper Networks would be a good idea since it would provide for greater scale in the increasingly competitive fixed and mobile communications equipment market, one analyst has reportedly said.

Brian White, an analyst at Cantor Fitzgerald, told StreetInsider that "a combination of the two companies would make sense as the networking and wireless worlds converge."

The comments came after German magazine Manager Magazin reported that Nokia is considering combining its networks division with Juniper Networks. The magazine did not cite its sources, saying they were confidential.

"Given the changes in the IT world and the ramp of the mobile Internet, we have long considered the networking world an attractive asset for wireless infrastructure players and large IT vendors," White added.

Nokia wants to deepen its existing sales cooperation with Juniper and a merger could be an alternative to a deal with Alcatel-Lucent, the magazine reported. Nokia would need to offer a premium to Juniper's market value of about $14 billion (€10.2 billion) to tap into Juniper's $3.1 billion cash reserves, it said.

Nokia said it did not comment on media speculation.

Manager Magazin added that Nokia, which is about to complete the sale of its devices and services unit to Microsoft for €5.4 billion ($7.4 billion), could present its new strategy without its handset business at the forthcoming Mobile World Congress, which takes place in Barcelona from Feb. 24 to Feb. 27.

It is also speculated that the Finnish company may take the opportunity to announce its new CEO at the event. Rajeev Suri, who has led NSN since 2009, and Nokia CFO Timo Ihamuotila are believed to be among the favourites.

For more:
- see this Manager Magazin article (translated by Google Translate)
- see this StreetInsider article

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