HELSINKI (AP) — Nokia said Monday that it will buySiemens’ half of their joint network
operations in a 1.7 billion euro($2.22 billion) deal, sending its shares surging more than 7
percent.Thetransaction, to be completed during the third quarter this year, willmean that the joint
venture between Nokia Corp. and Germany’s Siemens AGwill become a wholly owned subsidiary of the
Finland-based company. Thetwo companies formed the joint venture in 2007.Nokia’s shareprice jumped more
than 7 percent to 3.04 euros in morning trading inHelsinki, while Siemens stock was up 1.4 percent at
78.77 euros.NokiaSiemens Networks had been lossmaking for several years amid speculationand rumors that
it was an acquisition target. Meanwhile, Nokia alsobegan to struggle with its core production of
cellphones, losing itsdominant market position.Nokia’s German giant partner, with 370,000 employees
worldwide, also has been looking to cut costs.InNovember it launched a program aimed at saving 6 billion
euros by 2014.It has announced plans to restructure its water business and sell itssolar energy
business.In May, the Munich-based industrialconglomerate warned that earnings for its 2013 financial
year, whichends in September, would come in at the "low end" of forecasts due tonumerous
one-time charges and restructuring costs.Recently,however, Nokia Siemens Networks has shown signs of
improvement afterrestructuring and substantial job cuts, with a small first-quarteroperating profit this
year compared to a 1 billion euros loss in thesame period in 2012.Nokia chief executive Stephen Elop was
upbeatabout the company’s operational and financial performance and said thatthe company had also made
strides in developing LTE, or long-termevolution, high-speed data."Nokia Siemens Networks
hasestablished a clear leadership position in LTE, which provides anattractive growth opportunity,"
Elop said. "Nokia is pleased with thesedevelopments and looks forward to continue supporting these
efforts tocreate more shareholder value for the Nokia group."Nokia, oncethe dominant cellphone
maker, is struggling in the smartphone marketagainst Samsung, Apple’s iPhone and handsets that use
Google’s Androidsoftware. It is also being squeezed at the lower end against Asianmanufacturers making
cheaper handsets.Nokia said that theoperational headquarters of the networks sector will remain in
Espoo,near the Finnish capital of Helsinki. But Nokia said, it "will continueto have a strong
regional presence in Germany."The Siemens namewill be phased out from Nokia Siemens Networks’
company name andbranding, with the company’s new name to be announced at the closing ofthe
transaction.Copyright 2013 The Associated Press.