NSN spins off optical networks division

Telecoms equipment vendor Nokia Siemens Networks continues to streamline its operation, on Monday announcing plans to offload its optical networks business to an investment firm.

Under the deal with Marlin Equity Partners, a Los Angeles-based private investment firm with over $1bn of capital under management, NSN’s optical networks business will be spun off as a separate company that intends to run as “an industry leader in the fragmented optical networking sector.”

The planned transaction is another step in the transformation of NSN into a “mobile broadband specialist,” the company said.

Last year, NSN sold off its microwave transport business to DragonWave and its broadband access unit to US firm Adtran. A WiMAX operation acquired from Motorola in 2011 was also sold on in a back to back to deal to NewNet Communication Technologies.

As a result of the optical networks transaction, up to 1,900 employees – mainly in Germany, Portugal and China – are expected to transfer to the new company in line with applicable local legal requirements. The transaction is expected to close in the first quarter of 2013.

“During 2012 Nokia Siemens Networks has made tremendous progress in the transformation of our company to being the world’s mobile broadband specialist. Our strategic focus on our core markets has enabled us to concentrate our energy and investment in areas such as LTE where we have strengthened our global leadership position,” said Rajeev Suri, chief executive officer at Nokia Siemens Networks. “This transaction builds on that momentum and aims to provide a new home for the Optical Networks business with the focus, resources and strategic flexibility to address the opportunities in the optical market.”

The new optical company will be headquartered in Munich, Germany with operations around the world and will be led by its existing management team with Herbert Merz nominated as chief executive officer.