Nokia Acquires Infinera in a Historic $2.3 Billion Deal
Major Deal Strengthens Nokia's Position in the Telecommunications Market
Nokia Oyj has agreed to acquire Infinera, a manufacturer of optical communications equipment, in a deal valued at $2.3 billion, including debt. This acquisition marks Nokia's largest deal since its purchase of Alcatel in 2016.
Financial Details of the Deal
The deal, which includes a mix of cash and stock, values Infinera at $6.65 per share, representing a 37% premium over the company’s 180-day average share price. Infinera is headquartered in San Jose, California, according to a statement released on Thursday.
Infinera's Market Performance
Infinera's shares have risen by 15% over the past 12 months, giving the company a market value of approximately $1.2 billion. The shares, which closed at $5.26 on Thursday, surged up to 25% in after-hours trading.
Infinera's Products and Services
Infinera provides network hardware and software for mobile operators, internet content providers, governments, and other companies, according to its website. The company is led by CEO David Heard.
Nokia's Largest Acquisition Since Alcatel
This acquisition is Nokia's largest since the company, based in Finland, made its record-breaking purchase of Alcatel-Lucent for €10.6 billion ($11.4 billion), completed in 2016, according to data compiled by Bloomberg.
Nokia's Future Plans
Earlier on Thursday, Nokia announced that the French government plans to buy Alcatel Submarine Networks, valued at €350 million.
Nokia's Outlook for the Second Half of the Year
In January, Nokia indicated that it could see a rebound in the second half of the year, with its internet infrastructure business boosting sales, and cost-cutting measures yielding results. The company expects "strong improvement" in its network infrastructure business, which includes building submarine cables, terrestrial broadband, and fiber optic technology.
Deal Advisors
PJT Partners acted as Nokia's financial advisor, while Centerview Partners provided advisory services to Infinera, according to the statement.
