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Nokia Siemens Networks said Monday that it had agreed to buy the wireless-network equipment division of Motorola for $1.2 billion in cash.
Nokia Siemens, which makes telecommunications equipment, is a joint venture of Nokia of Finland and Siemens of Germany. Nokia, one of the world’s largest mobile phone makers, has struggled to maintain its footing in the cellphone industry as rivals like Apple and HTC of Taiwan, have gained market share.
The Motorola unit that Nokia Siemens is buying supplies wireless carriers with the equipment needed to build and maintain cellular networks, including infrastructure for the fourth-generation mobile technologies known as LTE and WiMax.
Nokia Siemens said the sale would be instrumental in helping it improve its traction in the United States and Japan, as well as bolster diminishing profits.
“First and foremost, this deal is about customers,” said Rajeev Suri, chief executive of Nokia Siemens, during a conference call on Monday with reporters and investors. “We expect to gain an incumbent position with many new customers and strengthen our position with others.”
Mr. Suri listed China Mobile, Verizon Wireless, Sprint and Clearwire as some of the companies his firm would establish relationships with as a result of the purchase.
“We’ve been weak,” he said. “This is a spot we have to cover.”
The transaction is expected to close by the end of the year, pending regulatory approval, the company said. Around 7,500 Motorola employees will join Nokia.
Motorola, which has also fought to retain a foothold in the smartphone market, has long planned to split itself into two companies, one making handsets and other consumer devices, the other focusing on equipment for businesses. Greg Brown, the company’s co-chief executive, said the sale of the unit would help put the company’s plan into motion.
“As we prepare to separate Motorola into two public companies, this transaction will further sharpen our strategic focus,” he said during the conference call. “This allows us to move unfettered, full steam ahead.”
Motorola plans to keep its iDen technology, which provides the push-to-talk function used by Sprint’s Nextel products.
Investors appeared to react favorably to the news. By early afternoon, Motorola shares climbed about 19 cents, or 3 percent, to $7.70. Nokia shares rose 3 cents, to $8.79.
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