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Buying Alcatel’s Wireless Unit May Be Difficult for Nokia: Exane 2013-11-04 09:04:21.375 GMT
By Sam Chambers Nov. 4 (Bloomberg) -- While a deal for Nokia to buy Alcatel’s wireless business is a “no-brainer” on paper, Nokia may incur EU500m restructuring costs and only realize EU300m cost benefits in a deal, Exane says. * Says timing of a deal is wrong from a technology cycle perspective; would be value neutral for Nokia, with front loaded costs * If Alcatel were to sell its wireless unit, fair value would rise to EU3.31/shr, equivalent to 15% upside, Exane says * Sees 50/50 chance of wireless sale; upgrades Alcatel to neutral * NOTE: Exane comments published before Alcatel announced EU955m rights issue, $750m bond sale today * Following the news, Alcatel shrs down as much as 9.3%, Nokia shrs up as much as 2.5%. Story
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--Editor: James Cone
To contact the reporter on this story: Sam Chambers in London at +44-20-7673-2021 or schambers7@bloomberg.net
To contact the editor responsible for this story: James Ludden at +44-20-7673-2645 or jludden@bloomberg.net