The transaction values HERE at € 2.8 billion ($4.22 billion) and is expected to close in the first quarter of 2016, subject to the normal regulatory approvals.
In April 2015, Nokia announced a review of strategic options for HERE in light of its proposed €15.6 billion acquisition Alcatel-Lucent. The announcement of the sale of HERE concludes that strategic review process, said Nokia CEO Rajeev Suri.
“With this step we complete the latest stage of Nokia's transformation. We integrated the former Nokia Siemens Networks, divested our devices and services business [to Microsoft, which now regrets the deal], and have now reached agreement on a transaction for HERE that we believe is the best path forward for our shareholders, as well as the customers and employees of HERE.
“Going forward, we will focus on our planned combination with Alcatel-Lucent. Once that is complete, Nokia will be a renewed company, with a world-leading network technology and services business, as well as the licensing and innovation engine of Nokia Technologies.”
HERE is developing a location cloud that “harnesses the power of data generated by vehicles, devices and infrastructure to deliver real-time, predictive and personalised location services.” The software is used on Windows Phone, and is a well-regarded rival to Google Maps and Apple Maps. It is also available as an app on Android and iOS phones.
HERE has been a separate operating division of Nokia, with sales of €971 million in 2014. It has 6500 employees. After selling HERE, Nokia will consist of two businesses: Nokia Networks – broadband infrastructure – and Nokia Technologies – software and services.
Upon closing, Nokia estimates that it will receive net proceeds of slightly above €2.5 billion, as the consortium will be compensated for liabilities of HERE currently expected to be slightly below €300 million. Nokia expects to book a gain on the sale and a related release of cumulative foreign exchange translation differences totalling approximately €1 billion.
Nokia suspended its capital structure optimisation program in conjunction with the announcement of the proposed combination with Alcatel-Lucent. Nokia said it intends to evaluate the resumption of a capital structure optimisation program after the closing of the proposed Alcatel-Lucent transaction.