Finnish firm Nokia will buy part of Panasonic's network business to grow its operations in Japan and strengthen mobile broadband portfolio for an undisclosed amount.
"Nokia Networks has entered into a memorandum of understanding to acquire part of the wireless networks business of Panasonic System Networks Company Ltd," Nokia said in a statement today.
The agreement covers Panasonic's mobile phone (LTE/3G) wireless base station system business for mobile operators and related wireless equipment system business, it said in the statement.
The two firms plan to conclude the agreement by the end of September this year, with expected closure scheduled on January 1, 2015, subject to customary closing conditions, including regulatory approvals.
As part of the deal, fixed assets and business contracts with Panasonic's customers are being transferred to Nokia Networks in Japan, including Panasonic employees involved in the business.
"Japan is a key market for us, and this agreement is a major milestone in forging closer ties in Japan. The acquisition of part of Panasonic's wireless network business would further strengthen our mobile broadband portfolio and add significant value for Japanese operators," Nokia Networks Executive Vice President (AMEA) Ashish Chowdhary said.
Through this acquisition, Nokia Networks aims to reinforce and further improve efficiency and quality control for product development and R&D.
It will also help strengthen Nokia's market share for base station systems and related wireless equipment in Japan.
In addition, Nokia Networks plans to leverage its extensive global experience and technical leadership in mobile broadband to grow its business in the acquired domestic carrier segment globally, it said.