Shares of Juniper Networks soared more than 19% in after-hours trading Wednesday after reports surfaced that Nokia was in talks to acquire the Silicon Valley-based networking company at a stiff premium.
But Nokia was quick to throw cold water on those reports.
CNBC reported late Wednesday Nokia was working on a deal that would value Juniper Networks at roughly $16 billion, well above its market cap of $11.12 billion at the market’s closing bell yesterday. A tie-up could combine Juniper’s networking assets with Nokia’s telecom-gear business.
Juniper declined to comment on the report, CNBC said. But Nokia hastily issued a statement denying the report.
“While Nokia does not typically comment on market rumors, given the specificity of press reports related to a potential acquisition of Juniper Networks, the company issued the following statement: Nokia is not currently in talks with, nor is it preparing an offer for, Juniper Networks related to an acquisition of that company,” the venerable Finnish firm said in a statement sent to members of the press.
Juniper claims the third-largest market shar worldwide for routers and switches used by ISPs, and it has expanded into edge routers, cloud-based systems and wireless networking, among other segments. Its third-quarter revenue came in at $1.26 billion, down 2% year over year and 4% sequentially, due in part to slower spending from telecom customers looking to navigate their network transitions to software- and cloud-based architectures.
Meanwhile, Nokia struggles with similar market challenges as wireless carriers plot their network strategies for 5G. Nokia posted a 9% year-over-year net sales decrease in the third quarter, and shares plummeted 19% in one day last month after the company said conditions will continue to be difficult into 2018.
A marriage between Juniper Networks and Nokia might make sense on multiple levels—their businesses are largely complementary, and the larger market for telecom gear may be ripe for more consolidation—but Nokia’s flat-out denial certainly seems to indicate no marriage is imminent between the two firms.