Nokia offers to buy Comptel for $370 million

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Helsinki: Finnish telecoms network equipment maker Nokia said on Thursday it is seeking to buy company Comptel for about €347 million ($370 million) to expand its software services business.

Nokia and its rivals, Sweden’s Ericsson and China’s Huawei have struggled recently as demand for faster 4G mobile broadband equipment has peaked and the move to the next-generation 5G networks are still years away.

Nokia said its customers were now turning to software to make their networks more intelligent.

“The planned acquisition is part of Nokia’s strategy to build a standalone software business at scale by expanding and strengthening its software portfolio and go-to-market capabilities with additional sales capacity and a strategic partner network,” Nokia said in a statement.

The cash offer, €3.04 per share, represents a premium of 29% compared with Comptel’s last closing price.

Comptel, which had sales of about €100 million in 2016, said its board of directors, and shareholders that hold about 48% of the shares backed the offer.

Last year, Nokia bought Franco-American group Alcatel-Lucent in a €15.6 billion all-share deal and is cutting thousands of jobs as it seeks to reduce annual costs by €1.2 billion ($1.3 billion) by 2018.