Report: Nokia Siemens reworking Motorola deal for Chinese approval

Nokia Siemens Networks is trying to reconfigure its $1.2 billion acquisition of Motorola Solutions' (NYSE:MSI) wireless networking business in order to win approval from Chinese antitrust regulators, according to a Bloomberg report.

The report, which cited unnamed sources familiar with the matter, said Nokia Siemens wants to drop Motorola's GSM business from the deal to win the approval of the Chinese authorities.  Accordingly, the company also wants to rework the pricetag of the overall acquisition. This change would likely leave NSN with Motorola's CDMA business. Representatives from Nokia Siemens and Motorola declined to comment.

Both Nokia Siemens and Motorola said earlier this month that the closing of the deal, which was first announced in July, had been postponed again, pending review by the Chinese regulators. Motorola said the review period has been extended for another 60 days. Nokia Siemens spokesman Ben Roome told Bloomberg at the time that the deal needed to be approved by antitrust authorities in all affected markets, and that NSN had received approval from every other market.

The deal is expected to improve NSN's position in the U.S. market as well as in Japan. Motorola customers include CDMA operators Verizon Wireless (NYSE:VZ) and Sprint Nextel (NYSE:S), among others.

"My understanding is that they were trying to get some new strength in certain areas like the U.S.," Susan Welsh de Grimaldo, an analyst at Strategy Analytics, told FierceWireless. "I would think even for the Chinese market they would still have a strong play to try to get positioning there without the GSM piece."

Complicating the deal is Huawei's suit against both Motorola and NSN, filed in January, alleging that the deal would expose Huawei's trade secrets to a competitor. Last month, a federal judge granted Huawei an order that prevents Motorola from transferring Huawei's intellectual property to Nokia Siemens. Importantly though, the judge did not block the deal from going forward, which Huawei was seeking.

According to research firm Dell'Oro Group, in the fourth quarter Ericsson (NASDAQ:ERIC) led the infrastructure market with 36.9 percent market share, while NSN followed with 21.4 percent and Huawei had 17.9 percent of the market.

For more:
- see this Bloomberg article

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