uploads///Nokias network unit quarterly sales decline

What’s the Story Behind Nokia-Juniper Merger Talks?


Jan. 1 2018, Updated 9:03 a.m. ET

Nokia ended talks to acquire Juniper

Nokia (NOK) has ended its rumored efforts to buy Juniper Networks (JNPR)CNBC had reported that the two hardware behemoths were talking about a merger deal. According to rumors, Nokia had been talking to a financial advisor to work out a buyout deal that would have valued Juniper at more than $16 billion.

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Story behind the merger

According to reports, Nokia, the network-equipment maker, has been striving for weeks to ink a deal with rival Juniper, which makes routers that help connect computers to the Internet. However, the speculations regarding the buyout were put to rest when Nokia stated, “Nokia is not currently in talks with, nor is it preparing an offer for, Juniper Networks related to an acquisition of that company.” The merger would have reportedly positioned Nokia to compete with Ericsson (ERIC) in Europe.

Like the Nokia-Juniper buyout rumors, there have been speculations in the past about Cisco and Ericsson merging to create a giant equipment vendor. The predictions ended in July 2016 after Ericsson’s then CEO, Hans Vestberg, said that a marriage of the two companies was “completely off the cards.”

Deals amid growing competition

Though Nokia could not make a deal with Juniper, Nokia has been quite active on the acquisition front. Earlier in November, the company signed a licensing and business partnership with Apple (AAPL). Also, Nokia inked a deal with China Unicom (CHU) to deploy small cells in China.

Nokia’s primary division, the networks unit, has been underperforming for quite some time now due to significant transitions in technology, intense competition in China, and other near-term headwinds. Moreover, the company doesn’t expect this segment to show recovery in the near term. In 2018, the network business is likely to decline between 2% and 5% as well.


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