Nokia Siemens to close services unit: sources

Tue Dec 4, 2012 7:19am EST
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FRANKFURT/HELSINKI (Reuters) - Nokia Siemens Networks' (NSN) services unit faces closure as an essential contract with Deutsche Telekom will not be extended, two people familiar with the matter said on Tuesday.

One person said the closure, effective en 2013 would be announced on Wednesday during a workers' meeting in Kassel.

NSN Services, which generates under 100 million euros ($130.7 million) in annual sales and employs about 1,000 people, ensures that calls and data are transmitted via overhead cable networks. Deutsche Telekom sold the unit to NSN five years ago.

At the time the two companies agreed on a 5-year 300 million euro services contract. The unit also counts Vodafone as a customer.

The contract would not be extended, the person said.

German daily newspaper Sueddeutsche Zeitung first reported about the closure of the unit.

Verdi union representative Mike Doeding said that a meeting to update workers about next year's plans was scheduled for Wednesday, adding he had no idea about the message to be expected.

"If they are to close the unit it would be an outrage," Doeding said.

NSN declined to comment, while Deutsche Telekom referred to NSN for comment.   Continued...

A red traffic light is pictured next to the company logo of Mobile network equipment maker Nokia Siemens Networks (NSN), in Munich November 29, 2012. REUTERS/Michael Dalder