Nokia Siemens Networks ready to go

Newly merged mega-vendor, Nokia Siemens Networks, said Thursday it will start operations under its new moniker on April 1.

Both companies have also agreed to increase their respective contributions to the new 50:50-owned company, with Siemens to contributing Eur2.4bn and Nokia to contribute Eur1.7bn.

Since Nokia will consolidate the financial results of Nokia Siemens Networks, the companies have agreed that the merged entity’s compliance and control processes will be based on Nokia’s system and practices.

The companies previously said that the merged entity is expected to start operations with 60,000 employees, however a substantial portion of cost reductions are expected to be realised via a reduction over the next four years in the range of 10 to 15 per cent of the initial combined staff base of approximately 60,000 – or 6,000 to 9,000.

Estimated cost synergies of Eur1.5bn annually by 2010 are expected to come primarily from the elimination of overlapping functions, consolidation and better utilisation of sales and marketing organisations, reduction of overhead costs, sourcing benefits, and greater efficiencies in R&D, the companies said.

“In the consolidating telecommunications market Nokia Siemens Networks will offer customers cost-saving, leading-edge solutions that will also optimally meet their needs with regards to convergence,” said Nokia CEO Olli-Pekka Kallasvuo.