Nokia - Company Announcement

Nokia completes next stage of transformation with agreement to sell HERE to automotive industry consortium at an enterprise value of EUR 2.8 billion

Nokia Corporation
Stock Exchange Release
August 3, 2015 at 08:00 (CET +1)

Nokia completes next stage of transformation with agreement to sell HERE to
automotive industry consortium at an enterprise value of EUR 2.8 billion

Espoo, Finland - Nokia today announced an agreement to sell its HERE digital
mapping and location services business to a consortium of leading automotive
companies, comprising AUDI AG, BMW Group and Daimler AG (the "Consortium"). The
transaction values HERE at an enterprise value of EUR 2.8 billion with a
normalized level of working capital and is expected to close in the first
quarter of 2016, subject to customary closing conditions and regulatory
approvals. Upon closing, Nokia estimates that it will receive net proceeds of
slightly above EUR 2.5 billion, as the purchaser would be compensated for
certain defined liabilities of HERE currently expected to be slightly below EUR
300 million as part of the transaction. Nokia expects to book a gain on the sale
and a related release of cumulative foreign exchange translation differences
totaling approximately EUR 1 billion as a result of the transaction.

In April 2015, Nokia announced a review of strategic options for HERE in light
of its proposed combination with Alcatel-Lucent. The announcement of this sale
to the Consortium concludes that strategic review process.

Rajeev Suri, President and Chief Executive Officer of Nokia, said: "With this
step we complete the latest stage of Nokia's transformation. We integrated the
former Nokia Siemens Networks, divested our Devices & Services business, and
have now reached agreement on a transaction for HERE that we believe is the best
path forward for our shareholders, as well as the customers and employees of
HERE. Going forward, we will focus on our planned combination with Alcatel-
Lucent. Once that is complete, Nokia will be a renewed company, with a world-
leading network technology and services business, as well as the licensing and
innovation engine of Nokia Technologies."

HERE is developing a location cloud that harnesses the power of data generated
by vehicles, devices and infrastructure to deliver real-time, predictive and
personalized location services. In the automotive industry, where it serves most
of the world's leading automakers, its focus is on developing precise and
accurate mapping as well as services that will enable an entirely new class of
driver experiences, including highly automated driving. The company also serves
the world's leading enterprises and Internet players, including Microsoft,
Samsung and SAP, and offers highly rated apps to consumers using Android, iOS
and Windows Phone."I believe today's announcement is a very good outcome for HERE, its customers
and employees. The new ownership structure of HERE will allow us to accelerate
our strategy, further scale our business and fulfill our intent to become the
leading location cloud company across industries," said HERE President Sean
Fernback.

HERE has been a separate operating and reportable segment for financial
reporting purposes for Nokia with a non-IFRS operating profit of EUR 46 million
on net sales of EUR 552 million for the first half of 2015, and a non-IFRS
operating profit of EUR 31 million on net sales of EUR 971 million for the full
year 2014. In reported terms, HERE generated an operating profit of EUR 28
million for the first half of 2015, and an operating loss of EUR 1 241 million
for the full year 2014, with the latter including a EUR 1 209 million charge for
the impairment of goodwill. At the end of June 2015, HERE had 6 454 employees.
Nokia plans to report HERE as a discontinued operation from the third quarter of
2015 onwards. HERE will continue to operate as a business of Nokia until the
closing of the transaction.

Upon closing of the HERE transaction, Nokia will consist of two businesses:
Nokia Networks and Nokia Technologies. Nokia Networks will continue to be a
leading provider of broadband infrastructure software and services. Nokia
Technologies will continue to provide advanced technology development and
licensing. Nokia's proposed combination with Alcatel-Lucent is expected to close
in the first half of 2016, subject to customary closing conditions and
regulatory approvals, and will create an innovation leader in next generation
technology and services for an IP connected world.

Nokia suspended its capital structure optimization program in conjunction with
the announcement of the proposed combination with Alcatel-Lucent. As previously
stated, Nokia intends to evaluate the resumption of a capital structure
optimization program after the closing of the proposed Alcatel-Lucent
transaction.

About Nokia
By focusing on the human possibilities of technology, Nokia embraces the
connected world to help people thrive. Our three businesses are leaders in their
fields: Nokia Networks provides broadband infrastructure, software and services;
HERE provides mapping, navigation and location intelligence; and Nokia
Technologies provides advanced technology development and licensing.
www.nokia.com

About HERE
HERE, a Nokia company, is a leader in navigation, mapping and location
experiences. We build high-definition (HD) maps and combine them with cloud
technology to enable rich, real-time location experiences in a broad range of
connected devices - from smartphones and tablets to wearables and vehicles. To
learn more about today's announcement, visit the HERE 360 blog.


Media Enquiries:

Nokia Communications
Tel. +358 (0) 10 448 4900
Email: press.services@nokia.com

HERE Communications
https://company.here.com/newsroom/contacts/
Email: press@here.com

Brunswick (adviser to Nokia)
Tel. +44 207 404 5959
Tel. +49 89 809902512

Investor Enquiries:

Nokia Investor Relations
Tel. +358 4080 3 4080
Email: investor.relations@nokia.com

Forward-looking Statements
This press release contains forward-looking statements, such as statements that
relate to the potential combination involving Alcatel-Lucent, Nokia's future
financial expectations, and the potential transaction involving our HERE
business. Some of these forward-looking statements can be identified by terms
and phrases such as "believe,""would,""will,""may" and similar expressions.
These statements are based on current decisions and plans and currently known
factors. These forward-looking statements are subject to a number of risks and
uncertainties, many of which are beyond our control, which could cause actual
results to differ materially from such statements. Risks and uncertainties
include: the impact of the potential combination involving Alcatel-Lucent; the
impact of the potential transaction involving HERE; the performance of the
global economy; the receipt of regulatory approval for the HERE and Alcatel-
Lucent transactions; the effect of changes in governmental regulations, as well
as other risk factors listed from time to time in Nokia's and Alcatel-Lucent's
filings with the U.S. Securities and Exchange Commission.


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