Nokia sells HQ for €170m, tenants included

Nokia has struck a deal to sell off its headquarters near the Finnish capital of Helsinki - although it plans to stay in the building for a while yet.
Written by Liam Tung, Contributing Writer

Nokia has found a buyer for its headquarters in Espoo, Finland, giving the handset maker a much needed cash injection of €170m. 

Nokia will take a long term lease with Finland-based property and investment group, Exilion Capital, the new owners of the 48,000 square metre facility on prime Espoo real estate overlooking the Gulf of Finland.    

Nokia has sold off its headquarters, but will still be a tenant there. Image: Nokia

Nokia's CFO Timo Ihamuotila said in a statement Nokia was "very pleased with this outcome". However, the sale price was lower than one estimate that predicted the buildings would go for between €200m to €300m

Ihamuotila added it was a "a comprehensive sales process with both Finnish and foreign investors". 

The deal covers the three core Nokia buildings, constructed between 1996 and 2001, along with 1,250 parking spaces. 

Nokia has retained ownership of its headquarters through two major recessions, and the sale brings an end to better days when it could afford to bear "non-core assets".  

"As we have said before, owning real estate is not part of Nokia's core business and when good opportunities arise we are willing to exit these types of non-core assets," said Ihamuotila. 

"We are naturally continuing to operate in our head office building on a long-term basis." 

Nokia confirmed it was looking to sell off its headquarters back in October, pointing to its second results results in July where it flagged re-evaluating non-core operations such as real estate. A Nokia spokesperson said at the time it never intended to move out of the building.  

The sale is a small part of Nokia's wider organisational and operational restructure -- including plans to lay off 10,000 staff by 2013 and shut down facilities such as the one in Salo -- which it's aiming to do without bleeding net cash reserves dry. Its net cash position stood at €3.6bn at Q3 2012 in October, down from €4.2bn the previous quarter, with device sales falling drastically ahead of the Windows Phone 8 launch.

Despite hopes that Nokia's Lumia 920 and the Windows Phone 8 launch will turn the tide for the company, Nokia is expecting a tough Q4 due to the ongoing appeal of rival top-end smartphones, such as Apple's iPhone 5 and Samsung's Galaxy devices.       

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