Nokia Siemens Networks is financially secure for the next three years, after agreeing a credit facility to replace backing from its parent companies.
The vendor agreed forward starting term and multicurrency revolving credit facilities with 15 banks around the world before an existing finance agreement with Nokia and Siemens expires this summer. The new credit facility is available until June 2015, while a term loan matures in June 2013.
Both finance facilities will be used to cover general corporate expenses, a company statement reveals. Marco Schroeter, chief financial officer of Nokia Siemens, claims the deals are a “strong endorsement of the company’s bold new strategy and restructuring plan,” due to current difficulties facing companies seeking credit.
The vendor’s restructuring plans involve focusing solely on mobile broadband networks in a bid to cut its operating expenses by €1 billion by end-2013. The move has already seen the firm sell two business units now considered non-core – ADTRAN in December and its WiMAX division in November – and detail plans to cut its workforce by 17,000 over the next two year.
Nokia Siemens cut its operating loss from €686 million in 2010 to €300 million in 2011, however the reduction came only after the parent companies agreed to inject an additional €500 million each into the joint venture.