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August 31, 2012

Under New Strategy, Nokia Siemens Plans to Sell Business-Support Systems Unit

By Ashok Bindra, TMCnet Contributor

Based on sources close to the matter, Bloomberg (News - Alert) Businessweek reported that Nokia Siemens Networks is in advanced talks to sell business-support systems (BSS) unit that helps phone operators manage their billing systems. As the network-equipment venture of Nokia Oyj and Siemens AG (News - Alert), it plans to focus on mobile broadband, reports Businessweek.

Potential buyers for the BSS division nclude Sweden’s Ericsson AB, U.S.-based Amdocs (News - Alert) Ltd and private-equity firms. Businessweek wrote that the sources with knowledge indicate that the BSS unit could fetch as much as 300 million euros ($377 million).

Businessweek reporters Mathew Campbell and Adam Ewing wrote that telecom equipment providers like Nokia Siemens and French rival Alcatel-Lucent SA are laying off employees to cut costs as the slowing global economy slows spending on infrastructure for mobile networks. The report shows that Nokia Siemens is in the process of eliminating some 17,000 jobs, about a quarter of its workforce, by the end of next year. While Alcatel-Lucent has stated that it will cut 5,000 jobs after reporting a quarterly loss.

In an email response, Nokia Siemens spokesman Ben Hunt said, “As we announced in November, Nokia Siemens Networks (News - Alert) believes that the future of our industry is in mobile broadband and we are intensifying our strategic focus on that area. Business areas not consistent with the new strategy are planned to be divested or managed for value, and we have already announced the divestment of a number of these business.

According Businessweek, selling the BSS unit would be the latest in a string of asset sales. Nokia Siemens, which was created in 2007, completed the sale of its microwave transport business to DragonWave (News - Alert) Inc. in June and completed the sale of its fixed line broadband access business to Adtran Inc. in May.

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Edited by Amanda Ciccatelli
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