NOKIA has agreed to acquire Infinera in a transaction valuing the maker of optical telecommunications equipment at US$2.3 billion including debt.
The cash-and-stock deal will value Infinera at US$6.65 a share, a 37 per cent premium to the trailing 180-day average of the San Jose, California-based company’s share price, according to a statement on Thursday (Jun 27).
At least 70 per cent of the deal will be paid in cash, with the rest consisting of Nokia’s American depositary shares, according to the statement confirming an earlier report by Bloomberg News.
Infinera’s stock had risen 15 per cent over the past 12 months, giving the company a market value of about US$1.2 billion. The shares, which closed on Thursday at US$5.26 each, jumped as much as 25 per cent after the close of regular trading.
Infinera provides networking hardware and software to mobile phone operators, Internet content providers and governments, among others, according to its website. The company is led by chief executive officer David Heard.
The acquisition is the largest for Finland-based Nokia since its biggest-ever deal, the 10.6 billion euros (S$15.4 billion) takeover of Alcatel-Lucent completed in 2016, according to data compiled by Bloomberg. Earlier Thursday, Nokia said that the French government planned to purchase its Alcatel Submarine Networks, which has an enterprise value of 350 million euros.
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Nokia said in January that it might see a pickup in the second half of the year as its Internet network infrastructure business brings in sales and cost-cutting measures pay off. It said it expected “strong improvement” in its network infrastructure business, which includes building submarine cables, terrestrial broadband and fibre optic technology.
PJT Partners served as financial adviser to Nokia, while Infinera was advised by Centerview Partners, according to the statement. BLOOMBERG
