Nokia (OMX: NOK1V) held up well in negative sessions after another set of wild market speculations. Danske Bank started the debate today with a recommendation hike and a target price raise coupled with a somewhat mystifying declaration that a smartphone deal where Nokia would sell its smartphone business ”makes sense”. Nordea’s analysts told Kauppalehti that their feeling is that it would not make sense to just sell smartphone unit and Nokia’s spokesman denied the rumours.
With Nokia, there has even been a drive to blur the difference between a smartphone and a regular device. Right now the company has not yet proven if its new strategy will work. More typical time for a takeover or a merger would be after there is more visibility in the situation. In any case, the takeover would be more likely in case of a failure than in success, given that Nokia still boasts a 15 billion Euro market cap even at current levels, which with a premium on top would be a big albeit not impossible bite to chew.
The M&A speculation high offset some belittling comments from analysts over the choice of the operator and model, after Nokia and T-Mobile unveiled the first Nokia Windows phone to US market with Lumia 700 becoming available in January. According to comments given to Reuters, Nokia seems to have a plan to bring a particular phone exclusively on one carrier in the USA, which should enlighten the reasons behind this particular combo. The two companies are targeting first-time smartphone buyers with the offering and the price of the phone is subsidized presumably to try to grow customer base to a critical mass.
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