FILE PHOTO: The logo of Nokia is seen before the company’s news conference in Espoo, Finland March 2, 2020. Lehtikuva/Markku Ulander via REUTERS
HELSINKI (Reuters) – Nokia is continuing its own investigation, and cooperating with the authorities, over compliance issues at its Alcatel-Lucent business, the Finnish firm said in its annual report to the U.S. Securities and Exchange Commission.
The telecoms network equipment maker flagged the investigation a year ago in its 2018 annual report, news which hit its shares in March 2019. Nokia did not unveil details, but said the risks were limited.
“We have seen no evidence that would suggest that criminal penalties would apply in this case, and we believe it is highly likely that any penalties that might apply would be limited and immaterial,” Nokia said.
The telecoms sector has seen a number of relatively large deals in recent years: Nokia itself bought Siemens out from their mobile networks’ joint venture in 2013, and Alcatel-Lucent – which Nokia bought in 2016 – was a result of a 2006 merger.
However, integrating acquisition targets has been cumbersome – those deals have been plagued by difficulties including trying to cut costs in an R&D intensive business, rivals poaching contracts, and struggles over boardroom power.
Reporting by Tarmo Virki; Editing by Christopher Cushing