Nokia announced on Tuesday that NVIDIA will make a USD 1 billion equity investment in the company as part of a new strategic partnership aimed at developing AI-powered radio access networks (AI-RAN) and data centre networking solutions.
The Board of Directors of Nokia has approved the issuance of 166.4 million new shares to NVIDIA at a price of USD 6.01 (EUR 5.16) per share. Following the transaction, NVIDIA will hold approximately 2.9% of Nokia’s total shares, subject to customary closing conditions.
“The strategic partnership and investment are expected to create value for both companies,” Nokia said in its statement. “Nokia will use the proceeds to accelerate its strategic plans to advance trusted connectivity for the AI supercycle and other general corporate purposes.”
As part of the partnership, Nokia plans to optimise its 5G and 6G RAN software to run on NVIDIA’s architecture and increase its presence in the AI and cloud markets through data centre-aligned networking solutions within its Network Infrastructure business.
The two companies will also collaborate on AI networking solutions and explore integrating Nokia’s data centre switching and optical technologies into NVIDIA’s future AI infrastructure.
Nokia stated that the subscription price was negotiated between the companies after taking independent legal and financial advice to evaluate the fairness of the terms. “In the assessment of Nokia, the strategic partnership, including the share issuance, benefits Nokia and its shareholders,” the company said.
The newly issued shares will be delivered to NVIDIA as American Depositary Shares (ADS) and are expected to be registered with the Finnish Trade Register in November. They will be listed on Nasdaq Helsinki, Euronext Paris, and the New York Stock Exchange, along with existing Nokia shares.
Following registration, Nokia’s total number of shares will increase to 5.74 billion, with the new shares representing approximately 2.9% of the total.
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