Nokia seeks to expand software business with Comptel acquisition

Lucy Hill
February 10, 2017

Nokia Corp. said Thursday that it intends to acquire Comptel Corp.in a tender offer that values the software company at about €347 million ($370 million) as the Finnish technology giant looks to build out its software business.

Nokia is offering 3.04 euros per outstanding share of Comptel stock, which is said to be a 28.8% premium over the stock's closing price on February 8, and a 51.8% premium compared with the stock's volume-weighted average trading price during the past year.

Nokia past year completed the acquisition of Alcatel-Lucent. Additionally, Comptel will be providing Nokia new software technology, network of people to sell services to the market, and a base of carriers that are already using Comptel services. Nokia feels it will be more powerful in areas such as service assurance and fulfilment and the intelligence and automation to create and manage complex service offers.

Bhaskar Gorti, President of Nokia's Applications & Analytics business, said: "The timing of the Comptel purchase is important as our customers are changing the way they build and operate their networks". After the announcement, shares of Nokia jumped 1.5%, while shares of Comptel increased 31%.

"They are turning to software to provide more intelligence, automate more of their operations, and realise the efficiency gains that virtualisation promises".

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In November 2016, Nokia announced its long-term strategy, dubbed, "Rebalancing for Growth".

Comptel was founded in 1986 and has over 800 employees in 32 countries.

Comptel's revenue in 2015 was Euro 98 million with 8.7 percent operating margin. The company's major sites are in Finland, Bulgaria, Malaysia, India, UK and Norway.

The planned acquisition is not expected to have a material effect on the operations and business locations of, or on the number of jobs at Comptel.

Earlier this month, Nokia CEO Rajeev Suri said the ability to provide an end-to-end product portfolio would help to improve its financial performance - like-for-like sales fell 13 percent in 2016.

Other reports by TheDailyFarc

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