Print 7 comment(s) - last by Penti.. on Dec 11 at 10:35 AM

Move raises much needed capital, allowing Nokia to continue its Windows Phone 8 push

Nokia Oyj. (HEX:NOK1V) announced on Tuesday that it had at last located a buyer for its gleaming Finnish headquarters.  Mired in financial troubles, Nokia has been selling off assets -- including some of its patents -- to help it sustain its Windows Phone 8 push as it downsizes and attempts a turnaround.

Interestingly, while Nokia sold its headquarters for €170M ($222.5M USD) to Exilion in a deal to be closed by the end of the year, it's also going to stay in the headquarters on a "long-term" lease deal.  In that regard the move is similar to Ford Motor Comp.'s (F) decision pre-recession to re-mortgage most of its North American properties, a move that gave it capital needed to weather the recent recession and become the only member of America's Big Three automakers not to enter government-guided bankruptcy.

Nokia's CFO Timo Ihamuotila remarks on the deal, "We had a comprehensive sales process with both Finnish and foreign investors and we are very pleased with this outcome. As we have said before, owning real estate is not part of Nokia's core business and when good opportunities arise we are willing to exit these types of non-core assets. We are naturally continuing to operate in our head office building on a long-term basis."

Nokia HQ
Nokia's headquarters building is for sale. [Image Source: Reuters/Benjamin Suomela/Lehtikuva]

The decision to release the headquarters is also interesting as some had speculated Nokia might look to shift more of its management to North America, to be closer to ally Microsoft Corp. (MSFT).  However, it appears that for now Nokia is holding tight to its Finnish roots, even as it trims its workforce.

Source: Nokia

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RE: In the long run
By chµck on 12/5/2012 1:53:41 PM , Rating: 2
Cool, but all that was before the new lumia launch, which is what I was basing my new view on.

RE: In the long run
By Penti on 12/11/2012 10:35:23 AM , Rating: 2
I'd say they still loose money and is turning into nothing. They still have a few tens of thousands of workers to lay off. It does pay off for Microsoft but that is a whole other matter. You can't base your views on a platform which never will be big enough to sustain this brands business. Without looking at any facts not even taking into account the most positive outcome of WP market share. It won't sell hundreds of millions of devices and they still have competition in the WP8 field from players like HTC which still have navigation sponsored by Nokia through Microsoft. They still doesn't sell anything in the US. Finland certainly lost billions, it even lowered their GDP. Single track doesn't work here, and they should obviously have waited for WP8 before saying anything about any change in offerings. It obviously is gonna be a small platform and there is no porting of Android apps like on new devices from RIM here. Sales won't increase to tens of millions of devices in Q4.

It has a long way even to reach a market share of 5% with Nokia only having a small part of that to begin with. Doubling the Q3 sales at Nokia wouldn't do anything to put them into black. It's a long way after the smartphone sales of a small player like HTC. They won't make it into the top five suppliers of smart phones next year, and even that top them can hardly support 15 000 employees. Who cares about a future Nokia of a few thousand employees with contract manufactured Qualcomm-designed phones serving as a for Microsoft? Not even WP8 buyers I can almost guarantee. They have no growth to look forward to and will have nobody to innovate anything. They will not have the competence to build mobile os's or design hardware and they certainly won't have any advantage over other competitors. It will take so much time for them to establish themselves with WP8 so everybody will have moved on.

"Spreading the rumors, it's very easy because the people who write about Apple want that story, and you can claim its credible because you spoke to someone at Apple." -- Investment guru Jim Cramer

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