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sydneylocks 513 posts  |  Last Activity: 17 hours ago Member since: Mar 24, 2003
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  • sydneylocks sydneylocks 17 hours ago Flag

    just got the email, interesting that both companies signed off on this email.

  • The last hope of the shorts to prevent approval. It took 7 months, caused considerable doubt, but in the end Nokia emerged triumphant.

    Msft would've needed the huge China market, no question. Thank god it went thru. The remaining issues are as mayflies by comparison. I don't think anything can stop the deal now...and that means, nothing will be able to stop Nokia from becoming the IP giant its fated by its 60B R&D investment to become. Been around this game a long long time, not often one gets a chance like this.

    Loeb was right, its going to take a while for the street to wake up to Nokia's potential, even now, most of the mainstream press is still going on about Nokia's devices.

  • sydneylocks sydneylocks Apr 16, 2014 4:18 AM Flag

    ..article from Intellectual Asset Management

  • the Taiwan Fair Trade Commission (TFTC) conditionally approved Microsoft’s proposed acquisition of Nokia’s mobile devices and services businesses. The transaction also envisages Nokia licencing all relevant patents to Microsoft for a perpetual term on a non-exclusive basis.

    The transaction constitutes a vertical integration between Microsoft’s Windows Phone mobile operating system business and Nokia’s smart phone manufacturing business. Noting that Windows Phone’s share in the operating system market is about 3.4 per cent worldwide and 2.2 per cent in Taiwan, the TFTC took the view that there was little risk of exclusionary effects if Microsoft were to refuse competing smart phone makers access to its Windows Phone operating system.

    However the TFTC expressed concern that post-transaction Microsoft might increase royalties for a number of its patents used by Android, a competing mobile operating system. Similarly, the TFTC expressed concern that Nokia, which owns standard essential patents for mobile devices, might also increase royalties for licensing these patents.

    To address the above concerns, the TFTC required Microsoft not to charge unreasonable royalties for smartphone-related patents that may affect the smartphone manufacturers’ choice of operating system. Nokia for its part is required to license its standard essential patents on FRAND terms and to ensure that in case of transfer of these patents to another company, that company also adopts FRAND licensing terms.

  • sydneylocks sydneylocks Apr 15, 2014 11:42 AM Flag

    what part of the Chinese approval didn't the short seller like I wonder.

  • sydneylocks sydneylocks Apr 15, 2014 7:21 AM Flag

    the chain gang rather, they're already in prison

  • JPMorgan reinstates Nokia Corp (NYSE: NOK) at Overweight and price target of #$%$8 ($10.80).

    Analyst Sandeep Deshpande noted the substantial potential Nokia has to monetize its patent portfolio. He thinks that if Nokia were able to take in 1 percent royalty per device, the firm's price target would easily move to #$%$15.

    Deshpande commented, “Nokia has a broad patent portfolio (ex NSN) of ~10k patent families comprising ~30k patents. Only ~10% of the patents are externally licensed & Nokia has built a large trove of implementation patents which are linked to its essential patents.”

    There is two key ways Nokia can fully monetize its patents:1.Getting better terms on new licensing deals given that Nokia has a stronger share of LTE patents versus 3G; and

    2.Broader licensing and enforcement of non-essential patents.
    There might also be opportunity for Nokia in unraveling cross-licensing agreements. Say Nokia licensed certain IP to Apple and doesn't need that access any more, it would be able to sell that patent in whole.

    Nokia also recent won an injunction against handset maker HTC. Deshpande sees two points in this segment:1.Qualcomm's (Nasdaq: QCOM) LTE chips contain Nokia IP; and

    2.While Qualcomm is a licensee, the right does not pass through to its customers. HTC would need to obtain its own license with Nokia.
    Deshpande comments, “Qualcomm sells over 700 million
    of these chips every year and once this case precedent has been set, Nokia can use it to claim royalties on that IP from many other infringing companies. The results of the key Samsung arbitration re additional payments will be known in early 2015 as well which should be a catalyst.”

  • sydneylocks sydneylocks Apr 15, 2014 2:05 AM Flag

    we calculate NOK can comfortably buy back 40% of the float driving double-digit earnings growth for at least 4 years.

  • Reply to

    MSFT/NOK to close the deal 4/15/2014

    by jeffreber44 Apr 14, 2014 3:48 PM
    sydneylocks sydneylocks Apr 15, 2014 1:02 AM Flag

    worried?

  • Reply to

    nokia to bleed even more cash

    by dorianpc Apr 14, 2014 5:19 PM
    sydneylocks sydneylocks Apr 15, 2014 1:00 AM Flag

    what part of limited liability can't you understand dorian The way is clear, all the indian employees will be let go and the sub will be wind down, this is the first evidence supporting this, and it is the absolutely correct thing to do.

    Here read it again slowly....Nokia India is a separate entity from Nokia Finland...if you want i'll repeat that even slower for you.

  • Reply to

    Price action

    by bill035419 Apr 14, 2014 12:10 PM
    sydneylocks sydneylocks Apr 14, 2014 1:37 PM Flag

    wouldn't logic dictate that they upgrade nokia?

  • Chinese regulators recently approved Nokia’s (NYSE:NOK) sale of its handset business to Microsoft (NASDAQ:MSFT), ending speculation that the Lumia maker may face tougher regulations while enforcing its patents in the country. The 5.4 billion Euro transaction was earlier expected to close by the end of March but delays in securing regulatory approvals led the companies to push it to April. Nokia has already secured the approval of antitrust officials in the U.S. and Europe, and will now be waiting on the outcome of the legal proceedings of its pending tax case in India although that is likely to have little material impact on the transaction value for the company. Moreover, the fact that none of the regulators have so far asked Nokia to make changes to its patent licensing terms lifts the uncertainty around its IP business, which could be a significant value contributor to the company.

    The stock is trading close to our $7.50 price estimate for Nokia, which we believe is fair value given its current royalty run rate of Euro 600 million and the uncertainties associated with the timing and royalty rates of future licensing agreements. However, there could be a significant upside to our price estimate if Nokia manages to monetize a greater proportion of its patent portfolio and is able to renegotiate existing contracts at higher rates when they come up for renewal in the coming years.

    See our complete analysis for Nokia here

    Nokia’s IP Clout

    As a result of the high R&D spend incurred over the past decade, Nokia has built a very strong patent portfolio, comprising close to 16,000 issued patents and 4,500 pending patent applications in the U.S. Outside the U.S., the company has over 20,000 patents (both issued and pending) with a majority of them in Europe. [1] Nokia’s patents stand out not just in their sheer numbers but also quality. In a 2011 review of the 3,000+ patents considered essential to 4G LTE technology, Thomson Reuters and Article-One found that Nokia held close to 19% of the standard essential LTE patents and was the LTE leader by a big margin. [2] Qualcomm, the dominant mobile chipset manufacturer, trailed Nokia with a share of about 12.5% of the LTE patents deemed the most essential.

    Currently, Nokia generates almost all its licensing fees from standard-essential patents, which account for only about 10% of its patent portfolio and are required to be licensed to others at fair and reasonable rates under FRAND terms. The rest, which include implementation patents, haven’t been monetized well, since Nokia historically preferred to use them to defend its handset business instead. As a result, Nokia’s handset royalty rate is estimated at less than 0.3% currently, as compared to Qualcomm, which licenses out the breadth of its patent portfolio to handset makers and collects a licensing fee of about 3.2% on the ASP of each device containing its technology. Also, while Qualcomm has over 250 patent licensees paying it recurring annual royalties, Nokia has only about 40. [3]

    All Eyes On Samsung Deal

    There is, therefore, a big opportunity for Nokia to bring more patent licensees into the fold, and to license a bigger portion of its patent portfolio without having to worry about cross-licensing and protecting its handset business. This might allow the company to negotiate better royalty rates with handset makers. Given that future smartphone sales will be largely driven by these markets, any move by regulators to cap Nokia’s future royalty rates could have limited the upside potential in its licensing business.

    With Chinese regulatory concerns out of the way, Nokia will be well served in its royalty renegotiations with Samsung, which is the biggest Android player and accounts for almost 35% of the smartphone market currently. Nokia recently extended its patent licensing contract with Samsung, which would have otherwise expired by the end of 2013, by another five years. The companies haven’t agreed on the royalty rate and other contractual terms yet, but expect to settle through arbitration in 2015.

  • they nailed both the china and india issues. this is from a month back but still relevant:

    Citi Research analysts Ehud Gelblum, Amit B Harchandani and Stanley Kovler evaluate Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) in terms of its confrontation with the Indian government and what effect it will have on the company.

    We believe that the increasingly messy tax dispute between Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) and the Indian Government over a $342 Million tax bill does not have the potential to derail the $7.44 Billion sale of the Devices and Services business to Microsoft.

    Nokia’s excess capital in Vietnam facility

    In fact, we believe if India does not allow the transfer of Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V)’s Chennai facility, that the D&S deal likely closes anyway, and Nokia simply continues to run the plant for Microsoft Corporation (NASDAQ:MSFT) for a period of time during which the manufacturing gets moved out of India and to Nokia/Microsoft’s other facilities, after which, Nokia shuts down the Chennai facility. We believe Nokia has plenty of excess capacity in its Hanoi, Vietnam facility. We therefore believe Nokia continues to negotiate the tax liability separately from its attempts to win approval to transfer the plant and that the immediacy of the Q1 deal close date is likely not factoring into how Nokia handles the dispute.

    While we believe Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) eventually settles the dispute and pays some amount – i.e. the amount is not likely to be zero – we equally do not believe the final amount ends up anywhere near the $1.37 Billion+ sum suggested by the Indian IRS in Dec. 2013, per Reuters, nor do we expect any money to be paid for many, many years. As a comparison, Cisco Systems, Inc. (NASDAQ:CSCO) has been involved in a similar dispute with the Brazilian authorities over the alleged underpayment of $385 Million in assorted taxes from 2003-2008, and the current claim including penalties and interest has today risen to $3.2 Billion. Today, 6 years after the last year in the range, Cisco has yet to pay a dollar and is continuing to defend its claims and does not expect a final judicial determination for several more years. We therefore expect litigation between Nokia and India to go on for years with no resolution in sight, and certainly not one that overhangs the closing of the Microsoft deal.





    Nokia has some bargaining room in the negotiation

    In addition, we do believe Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) has some bargaining room in the negotiation because the wind down of the Chennai, India facility, assuming a transfer to Microsoft Corporation (NASDAQ:MSFT) is not granted, could mean the loss of at least 8,000 jobs as well as the potential loss of multiple thousands more of workers in supplier facilities in the immediate area that feed into the Nokia facility. As a result, we would expect this scenario could be an unfavorable outcome to the Indian government and might expedite a more down-the-middle settlement, although we have no knowledge of the state of mind of the Indian government.

    China approval remains the final necessary step in clearing the Microsoft deal, and it is our understanding that despite requests from Chinese handset firms to the Chinese Ministry of Commerce to prevent Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V)’s raising licensing fees and royalties on local Chinese handset OEMs, according to Bloomberg, the primary criteria the Chinese Gov’t may use in granting approval is antitrust, a non-issue we believe as Microsoft has no handset business in China already. We therefore continue to expect China approval and the deal to close in the next several months.

    Nokia’s valuation

    We arrive at our $9.571 valuation from a sum of parts across Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V)’s three main surviving business lines, Nokia Solutions Networks, HERE and Advanced Technologies, and then adding in our estimate of the $10.94 Billion in net cash the company should have following the completion of the sale of the Devices & Services business to Microsoft. We value each of the three businesses using a DCF.

    Versus its closest peers, we calculate “new” Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) is the cheapest on an EV/EBITDA basis. Assuming management is comfortable moving to a net debt position, we calculate NOK can comfortably buy back 40% of the float driving double-digit earnings growth for at least 4 years.

  • sydneylocks sydneylocks Apr 14, 2014 4:28 AM Flag

    The cash is real enough, Nokia needs to start outlining its future, no excuse to keeping silent now when Msft has already announced its leadership spots....even elop has got his EVP at msft...nokia needs to step up to the plate, 7months of nothing is getting ridiculous

  • Reply to

    Canaccord Genuity Sees $10 Upside for Nokia

    by sydneylocks Apr 9, 2014 4:11 AM
    sydneylocks sydneylocks Apr 14, 2014 4:25 AM Flag

    some more analysts increasing the price target.

  • Reply to

    Excess cash after the deal

    by sydneylocks Apr 12, 2014 12:34 AM
    sydneylocks sydneylocks Apr 13, 2014 4:15 PM Flag

    Analysts estimate that Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) will have a net cash position of about #$%$7 billion, close to 40% of its total market value after closing the deal. The Finnish company is likely to generate about #$%$1 billion in free cash flow this year. So, it will have a healthy balance sheet flexibility for investments and/or cash returns. Analysts argue that Nokia may announce total cash return of #$%$3.55 billion. The company has a variety of options.

    Nokia may pay down debt

    Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) will pay back #$%$1.5 billion convertible to Microsoft Corporation (NASDAQ:MSFT) as part of the deal closure. As of February 2014, the company had #$%$1.75 billion in bonds due. By the second quarter, UBS estimates that the Finnish company will have #$%$3.25 billion lower gross debt on its balance sheet. So, the company may pay down further debt.

    Issue a dividend

    Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) is likely to reward its patient shareholders. But Jenkins and Mulholland believe that the company would opt for a sustainable dividend policy rather than a one-off dividend payment. UBS models a pay-out ratio of 60-75% over the next few years. The research firm doesn’t expect any special dividend.


    Nokia may buy back equity

    UBS says that buybacks are likely to be the primary way Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) institutes a cash return policy. The company is estimated to buy back shares worth #$%$3 billion over the next two years steadily rather than as a tender offer. Under its existing program, Nokia been approved to buy up to #$%$370 million stock by the end of June 2014.

    Reinvest for growth

    Nokia Corporation (NYSE:NOK) (BIT:NOK1V) (HEL:NOK1V) has launched a #$%$1.5 billion cost saving program through continuing business, and NSN operating expenses have fallen from #$%$3.67 billion in 2012 to #$%$3.13 billion in 2013. But the company still invests heavily in its core business. R&D accounted fo

  • sydneylocks sydneylocks Apr 13, 2014 7:53 AM Flag

    nokia is a European stock, don't think there's much correlation with US Russel Small caps

  • Reply to

    Excess cash after the deal

    by sydneylocks Apr 12, 2014 12:34 AM
    sydneylocks sydneylocks Apr 12, 2014 9:19 PM Flag

    euros

  • 50wk just moved above 200wk

  • Reply to

    Close this weekend?

    by sydneylocks Apr 11, 2014 10:05 AM
    sydneylocks sydneylocks Apr 11, 2014 10:56 AM Flag

    well to be perfectly honest about it, its not much of a gamble at this point...weeks are counting down and the last hurdle is gone...new nokia is coming up fast; time to inaugurate nokia's next 100 years hip hip

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