Nokia to redeem $1.85 billion of Alcatel-Lucent notes in debt cutting

By Susanna Moon

Chicago, Jan. 11 – Nokia Corp. said it plans to redeem on Feb. 10 Alcatel-Lucent USA Inc.’s $650 million 4 5/8% notes due July 2017, $500 million 8 7/8% notes due January 2020 and $700 million 6¾% notes due November 2020.

Nokia plans to redeem $1.85 billion of senior notes issued by Alcatel-Lucent USA as part of its planned capital structure optimization program, according to a company news release and a 6-K filing with the Securities and Exchange Commission.

The redemption is part of Nokia’s planned €7 billion capital structure optimization program announced Oct. 29, which focuses on reducing interest-bearing liabilities of the combined Nokia and Alcatel-Lucent by about €2 billion, the company said.

“We are pleased to move forward quickly with the implementation of our capital structure optimization program,” Timo Ihamuotila, the company’s chief financial officer, said in the press release.

“Lowering the group’s gross debt level is in line with Nokia’s long-term target of reestablishing its investment-grade credit rating.”

Along with the notes redemption, Nokia said it will provide Alcatel-Lucent USA with a temporary revolving liquidity support facility until Nokia gains 100% ownership of Alcatel-Lucent.

Espoo, Finland-based Nokia is a wireless telecommunications equipment maker. Alcatel-Lucent USA is a subsidiary of Alcatel-Lucent SA, the Paris-based communication services provider controlled by Nokia.

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