Nokia has sold its wireless modem business to the semiconductor company Renesas Electronics, and the two firms have agreed to develop modem technologies together in the future.
The $200m (£132m) sale of Nokia's wireless modem business, which includes LTE, HSPA and GSM technologies and patents, was announced on Tuesday. In a joint statement, Nokia and Renesas said they had formed a long-term alliance to develop modem technologies for HSPA+, LTE — the long-term evolution of 3G, sometimes called 4G — "evolution".
Nokia also noted that divesting itself of the business would help it focus on its core handset and services businesses.
According to the statement, Tokyo-based Renesas — which will get around 1,100 Nokia R&D workers in Finland, India, the UK and Denmark as part of the deal — will combine its multimedia processing and radio frequency (RF) technologies with Nokia's wireless modem technologies in order to provide "advanced mobile platform solutions" to handset makers.
"Together with Renesas Electronics' robust line-up of application processors, RF transceiver [integrated circuits], high power amplifiers and power management devices, the wireless modem technologies enable Renesas Electronics to deliver a complete mobile platform solution to the market," the statement read.
Renesas, the third-largest semiconductor manufacturer in the world, is owned by NEC, Hitachi and Mitsubishi. It only began operations under its current name in April this year, following the merger of Renesas Technology and NEC Electronics.
Its acquisition of Nokia's wireless modem business will "perfectly complement our core competences and serve as the key driving forces in growing our mobile business in the global market," Renesas president Yasushi Akao said in the statement.
Nokia executive vice president Kai Oistamo added that the alliance will let Nokia "continue to focus on our own core businesses, connecting people to what matters to them with our mobile products and solutions".
Nokia had licensed its modem technology to Renesas Technology since 2009. The transfer of the wireless modem business to the Japanese company is scheduled to take place in the fourth quarter of 2010, subject to regulatory approval.
ZDNet UK has asked Nokia whether it will be transferring its 3G modem dongle business over to Renesas, but had received no answer at the time of writing.