In an effort to increase its market share in network deployment,
Nokia Networks, a division of Finnish telecommunications equipment
), has decided to buy SAC Wireless, a U.S. based network
installation services provider. However, financial terms of the
deal have been kept under wraps.
Nokia believes that post acquisition, problems plaguing the
company like site procurement, applying for certifications and
sub-contracting, among others, will be solved. The company is
expecting to finalize this deal in the third quarter of 2014. The
company also believes that this deal will help drive its revenues
SAC Wireless, with nearly 450 employees, has worked with leading
telecom operators in the past. It has provided assistance in
deploying network both in indoor and outdoor cells along with
offering 4G LTE renovations and integration of distributed antennas
In the first quarter of 2014, Nokia's Nokia Solutions and
Networks (NSN) segment generated $3.2 billion in revenues, down 17%
year over year. This segment accounts for almost 90% of the
company's revenues, and is likely to receive a healthy boost from
the SAC Wireless buyout, going forward.
We believe the acquisition of SAC Wireless will not only help
Nokia enhance its product portfolio but also lead the company to
win further orders. Recently, Nokia sealed a five-year deal
with Telenor - a multinational telecommunications company - to
provide the latter with radio access equipment and accomplished
services. Per the deal, NSN will help Telenor in upgrading its 2G,
3G and 4G networks across Europe and Asia. Nokia's security
solution helps maintain end users' privacy apart from guarding the
carrier's network assets.
Nokia currently holds a Zacks Rank #3 (Hold).
Other Stocks to Consider
Better-ranked stocks worth considering in this sector include
Comtech Telecommunications Corp.
Ubiquiti Networks, Inc.
). Comtech and Ubiquiti Networks sport a Zacks Rank #1 (Strong
Buy), while InterDigital carries a Zacks Rank #2 (Buy).
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NOKIA CP-ADR A (NOK): Free Stock Analysis
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