Nokia’s buyout of Alcatel-Lucent is more about Competitiveness and Innovation than costs: Nokia CEO

On Friday, top executives of communication company Nokia said that it would be too soon to talk about job losses after the takeover of French rival Alcatel-Lucent. As per reports, the massive buyout deal was about three times larger than Microsoft’s purchase of Nokia’s handset business about two years ago.

On Friday morning, Rajeev Suri, chief executive officer of Nokia, said that Espoo, Uusimaa, headquartered Nokia’s acquisition of its French rival Alcatel-Lucent is about innovation and competitiveness. He said the takeover is not about costs.

During a press conference in Espoo, top executives of the company talked about the rationale for the country’s biggest-ever corporate purchase. While talking about the takeover, Suri said that the company is going to buy Alcatel-Lucent and it is important to be clear about it. He and board chair Risto Siilasmaa informed that the deal is not a merger of equal companies.

This week, the companies stated that both of them planned to merge in a stock deal worth 15.6 billion euros. According to the reports, Nokia will buy about two-thirds of the new entity, which could start operating from next year. The headquarters will be in Espoo and CEO Suri and board chair Risto Siilasmaa will remain on their positions.

While talking about job cuts, the company stated that it will not cut French Jobs for about two years after the closure of the deal. Suri said, “There is nothing extraordinary in the commitment to France, nothing that wouldn't make business sense. When you do deals with France involved, you want to make sure that the government endorses your deal, understands the strategic rationale”.

According to Suri and Siilasmaa, it would be too early to say about possible job losses in Finland. Siilasmaa said that Nokia has about 7,000 employees in Finland while Alcatel-Lucent has about 6,000 in France. He said that there is not much immediate overlap in functions.