© Evertiq Business | June 09, 2011

Nokia breakup = Gain for shareholders

Finnish mobile phone giant Nokia saw its shares plummet and destroyed shareholder value, that analysts now believe it may be worth 52% more if sold and broken into pieces.
Once worth USD 300 billion, market value has now plummeted to USD 25.6 billion (a decrease of staggering 77%), writes Bloomberg. This – including net cash – makes the company actually cheaper than its biggest rivals based on earnings before interest, taxes, depreciation and amortization.

The interesting part

Analysts believe that a breakup of Nokia into 4 'units' – devices, infrastructure equipment, mapping software and patents – could be worth USD 39 billion. Representing a 52% gain for Nokia's battered shareholders.

Rumours about a possible breakup of the mobile phone giant have been flying high over the last days – Nokia lowered its 2Q earnings forecast for its Devices & Service division and scrapped its fiscal year forecast (evertiq reported May 31, 2011). Microsoft, Samsung Electronics, HTC, Huawei and ZTE have all been named as possibly interested parties.

As far as rumours go, this one is no different than the rest. "No comment!" from all sides.


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