Redknee, a provider of business-critical billing and charging software and solutions for communications service providers, is to acquire Nokia Siemens Networks’ Business Support Systems (BSS) business.
Canadian firm Redknee will pay €13m in cash for the BSS business, plus a maximum of €25m for certain performance-based cash earn-outs expected to be paid over 12 to 36 months post-closing. The acquisition is anticipated to close in the first half of calendar year 2013, subject to approvals.
Nokia Siemens Networks’ BSS business provides real-time charging, rating, policy, and customer care solutions to more than 130 communication service providers, including half of the top 100 global mobile operators.
Nokia Siemens Networks said today (5 December 2012) that it believes Redknee is best suited to take ownership of the business based on the strength of Redknee’s management team, continuity of the current BSS portfolio, and access to innovation for Nokia Siemens Networks’ BSS customers.
Approximately 1,200 employees would transfer to Redknee, underpinning current service levels and quality for customers. The planned acquisition would bring to Redknee a complementary global footprint that spans more than 90 countries, including Europe, Asia Pacific, the Middle East and Africa.
Rajeev Suri, CEO of Nokia Siemens Networks (NSN), added: ‘This planned transaction supports our transformation to focus on mobile broadband. Both Redknee and Nokia Siemens Networks have a reputation for high quality and customer commitment, which provides a common foundation for Redknee to build the BSS business in the future. We will work with Redknee to ensure a smooth transfer of the business and to provide some mobile broadband specific elements of the BSS portfolio to our customers.’
The sale is part of NSN’s current strategy to focus on mobile broadband and services along with an extensive global restructuring program, which will see up to 17,000 jobs go. NSN’s target is to reduce its non-IFRS annualised operating expenses and production overheads by €1bn by the end of 2013, compared with the end of 2011. Part of the strategy included divesting itself of business areas no longer considered core to its new strategy.
The decision by NSN to sell its BSS business unit is in marked contrast to rival Ericsson, which has considerably expanded its BSS and OSS (operations support services) capability following the purchase of US company Telcordia, a specialist in BSS and OSS R&D and services, which was completed in January this year.
Lucas Skoczkowski, Redknee’s CEO, commented: ‘This planned acquisition marks a significant milestone in Redknee’s long-term growth strategy. It would add strong long-standing relationships with new Tier 1 operators and expand Redknee’s market share and presence in high growth markets. Our expanded team would drive the continued success of our customers, as we strive to be the provider of choice for real-time converged billing, customer care, policy, and payment solutions in the communications industry.’
‘Our commitment to ongoing investment in the product roadmap will ensure that our customers will benefit from the complementary capabilities, larger scale, and impressive IP portfolio. In addition, this planned acquisition would create a significant solution suite that offers a compelling and proven alternative for global system integrators and partners,’ Skoczkowski said.
Until the agreement closes, Nokia Siemens Networks said it will work to ensure an orderly migration and transfer of the BSS business. Nokia Siemens Networks would retain a small number of broader customer contracts that include elements of BSS for GSM-R and mobile broadband related mediation.
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