Nokia isn’t having a great time in the market with Windows Phone adoption just slowly picking up pace now. And as if that wasn’t enough to set the company back, we’re now learning of a new low point in the company’s timeline. Nokia has agreed to sell one of its headquarters in Espoo, Finland for 170 million Euros, which is close to $222 million. This seems like a desperate attempt to cut costs as the company has been struggling to rake in profits. There have been plenty of job cuts in the past, which was an indication of what’s to come in the future. While Nokia is making this sound as if it’s a strategic decision, it doesn’t take a genius to see the real picture. This long term lease deal has been struck with a Finland based company named Exilion. Despite the deal, the company will continue to operate in the premises for a while, it is said. The sale of the headquarters is believed to be finalized by the end of this year.
The CFO of Nokia, Timo Ihamuotila had this to say in the company’s official press release – “We had a comprehensive sales process with both Finnish and foreign investors and we are very pleased with this outcome. 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. We are naturally continuing to operate in our head office building on a long-term basis.”
It was initially reported that the company was seeking somewhere close to 200 million Euros for the Espoo headquarters, but having settled to just 170 million Euros, one would think if this is a long term lease deal signed between Nokia and Exilion. The building is very special to Nokia as it has been in operation close to 15 years now. It is obviously disappointing to see a company like Nokia reach this level, but one can’t help but wonder if the company brought this on itself.
All hopes for Nokia currently ride on the Windows Phone handsets that the company is offering. They have been successful to some extent in particular markets, but haven’t received widespread success. Nokia’s Lumia 920 is all that people talk about today when any mention of Nokia is made. The device is currently doing well in the U.S, but its sales have been hindered due to low stocks with the retailers. Nokia puts in much of its efforts into marketing as much into R&D. While marketing has proved to be vital for the company’s existence in the highly competitive mobile industry, it seems like the company needs a little more than that to woo shareholders and potential customers too. Let’s see what the future holds for Nokia, as it desperately needs things to work in its favor now.