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Cisco Going Mobile, Acquiring Nokia?
Keruo writes "Sunday Business paper is reporting on its latest issue that Cisco Systems is considering of acquiring some large player in the mobile telephone field. According to a Reuters article the paper also suggests that the company is most likely Nokia. Neither of the companies have yet commented on the rumour." From the article: "Cisco's mainstay networking market was fast changing with the convergence of fixed-line and wireless networks, and Cisco needed a merger to acquire the technology to create intelligent wireless applications, which Finnish-based Nokia could provide."
Other than just becomming a conglomerate, I don't see much point. Wireless like Nokia does and network like Cisco does are just too different at this point. So unless they were going to use it for a big push at becomming the dominate VOIP provider (hardware wise), I can't really see it. This could endup as another AOL/TimeWarner in some ways.
That said, it doesn't make that much difference to me. If they can get Sprint (my cell provider) to carry Nokia/Cisco phones (un-crippled) then I'll be happy. Otherwise it won't mean that much to me personally.
But what would we call them? Nisco? Cikia? Nokisco? Just don't see a good name. Not like Squeenix (Square-Enix, or at least as I like to call 'em because it sounds better).
Comment forecast: Bits of genius surrounded by a sea of mediocrity.
Cisco is valued at 123 billion dollars(99,8 in euros). Nokia is valued at 71 billion dollars(57 in euros).
Nokia's market cap: $70.6B
Cisco's market cap: $123.3B
Nokia's cash: $1.4B
Cisco's case: $2.6B
Might be possible...
Nokia's chief of corporate communications Arja Suominen denies the news as unsupported speculation according the Finnish Broadcasting Company YLE.
Cisco has about $5 billion in cash & short-term investments. Nokia's market cap is $71 billion (and would probably need an offer that values the firm at $80 to $90 billlion to succeed). Even if Cisco liquidates its $11 billion in long-term investments, it can't swing this deal with what it has on hand.
Unless Cisco goes into major debt with a leveraged buyout, they can't afford to buy someone as big as Nokia.
Two wrongs don't make a right, but three lefts do.
Mod parent down: Nokia has total cash US$ 13.79B.
That's nearly 14 billion bucks of cash. That's 10 times more than what the parent reports.
Please check the facts for yourself instead of believing an anonymous poster.
Sigged!
It would certainly be a rather uncharacteristic or bold move by Cisco as far as their track record of corporate acquisitions go. I touched on this very briefly in my own rejected submission (which imho was slightly more informative than the one posted, however it was probably submitted later, so I'm not complaining).
I'll just post it here too, since it includes a few more links for those interested:
According to today's Sunday Business newspaper, Cisco Systems Inc. is thinking of buying the finnish mobile handset giant Nokia in the aftermath of CEO Jorma Ollila's retirement announcement. In the past Cisco has concentrated more on buying smaller, niche tech companies. But this time its chief is believed to be interested in merging with a wireless infrastructure company, and Nokia would fit this bill. The paper says the merger would help Cisco create "intelligent wireless applications". Convergence is the buzz word of the day and this move would certainly combine the fixed-line and wireless networking capabilities of the companies. Cisco is currently valued at about $123 billion (25.5 times earnings) and Nokia at $71 billion (18.8 times earnings). Neither company has yet commented on the rumour.
"Only two things are infinite, the universe and human stupidity, and I'm not sure of the former" - Albert Einstein