Nokia Sells Vertu Bling Phones To EQT VI
Swedish private equity-firm set to take control, with Nokia retaining minority stake
Private equity firm EQT VI is to acquire Nokia’s luxury mobile phone division business Vertu, as the troubled Finnish manufacturer seeks to reverse its fortunes.
Nokia will retain a ten percent minority shareholding in the company, with the deal expected to close in the second half of 2012, subject to customary regulatory approvals and closing conditions.
The terms of the transaction have remained confidential, although it was expected that the sale of Vertu would raise around €200 million (£162.5m) for Nokia.
Nokia’s plans to sell the subsidiary were first revealed last month and it was believed that UK-based Permira, who already own several luxury brands, were in pole position to acquire “the world’s most expensive phone brand.” However the Swedish-based EQT IV had emerged victorious in the race for Vertu, which employees around 1,000 people.
“With its strong brand, undisputed category leadership and attractive growth outlook, Vertu fits well with EQT VI’s investment strategy,” said Jan Ståhlberg, partner at EQT Partners, investment advisor to EQT VI. “EQT VI is excited about the opportunity to develop Vertu as a standalone company and plans to drive the development of the luxury mobile phone category through significant investments in retail expansion, marketing and product development.”
Nokia has said that it believes this is the best course of action for Vertu, which claims that it has delivered “double digit sales growth” in the last few years. Handsets are made with exotic materials such as precious metals, leathers and gemstones and can have a price tag as high as £200,000, but still run the Symbian operating system.
“This is a logical next step in the evolution of Vertu as the world leader in luxury mobile products,” said Perry Oosting, President of Vertu. “Since Vertu began in 1998, our business has grown every year, due to the efforts of our talented workforce and the unique products and services we offer to our customers. We believe that EQT VI will position Vertu to continue to grow and lead in our marketplace.”
Nokia will hope that the sale provides a much-needed boost, along with the release of its new flagship Lumia 900 smartphone and new additions to its Asha feature phone range aimed at emerging markets.
The company has put a lot of its eggs in the Windows Phone basket, but it could face legal action from shareholders over its decision to switch to the platform, with investors accusing it of lying to them.
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