Nokia Siemens to reorganise, announces new savings

3 November 2009 - Telecoms equipment maker Nokia Siemens Networks said today it plans to launch a new savings programme and to reorganise its operations in a bid to improve its financial performance and return to growth.

Nokia Siemens, which is a 50/50 joint venture between Finnish Nokia Oyj (HEL: NOK1V) and German Siemens AG (FRA: SIE), will aim to reduce its annual operating costs and production overheads by EUR500m by end-2011, compared to end-2009. The two-year programme is expected to entail costs of some EUR550m in total.

In addition, Nokia Siemens also plans to cut its product and service procurement spending related to cost of goods sold by considerably more than the above reduction.

As part of the savings measures, Nokia Siemens will also make a global review of its workforce, which may lead to a reduction of its 64,000-strong staff by some 7%-9%.

Furthermore, the telecoms equipment maker said it will reorganise its current five units into the divisions Business Solutions, Network Systems and Global Services as of 1 January 2010.

Nokia Siemens will also seek to further strengthen its business via partnerships and acquisitions.

(EUR1 = USD1.47)

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Related terms: acquisition, business, joint venture