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Nokia CEO on mega-merger: Possible head count cuts to take place "efficiently, quickly and with respect"

Nokia chief executive Rajeev Suri says that the practical implementation of its mega-merger with the French company Alcatel-Lucent will have some impact on head count. Suri told Yle that possible staff reductions would be implemented "efficiently, quickly and with a great deal of respect" - but that's it's still too early to tell where cuts would fall.

Nokia CEO Rajeev Suri speaks to Yle's Jyrki Hara about the company's merger with French telecoms equipment maker Alcatel-Lucent. Image: Yle

Speaking to Yle after announcing the company’s full-year financial results for 2015, Nokia CEO Rajeev Suri said that the company will be looking to secure savings and synergies as it moves to fully merge with the French telecoms equipment company Alcatel-Lucent.

Suri said that Nokia had promised the markets it would obtain 900 million euros in synergies from the deal by 2018. He said that overlapping functions in areas such as procurement, mobile networks, sales and marketing and some corporate functions are to be streamlined.

"There will be some impact on head count overall on a global level. We have said 900 million euros of synergies and some of that will involve head count as well. But like I said it’s early days and we’ll find a way to do this as efficiently, quickly as possible and with a lot of respect as we move forward," Suri commented.

Changes also possible in France

Employees in Finland have taken note of the fact that Nokia has given the French government an undertaking to protect French jobs for a two-year period following the consummation of the merger. He was asked whether Finnish employees would be at a disadvantage compared to their French colleagues.

"We said that there would be shifts in that head count, there would be reductions in some of the corporate functions, there would be new hiring, and we’ll focus more on R&D. So even within France there will be changes and this was well understood by the government."

Suri noted that the personnel in France accounts for roughly 3.4 percent of the combined companies’ global staff, and was therefore not a large proportion overall.

The CEO stressed that it is still early days in the integration process and not possible to describe the final impact on payrolls anywhere in the world.

"Fundamentally this is our headquarters, this is where we’re active. The global corporate functions will be here [Finland] and a lot of the activity will be here. This is an important place for us," he noted.

Avoding mistakes of Siemens merger

Suri told Yle that the biggest challenge of the ongoing year will be the final integration of the two companies. He said that he wants to avoid the mistakes that were made when Nokia merged with Siemens.

"We have to focus on combining corporate cultures and understand the companies’ similarities and differences. We must make sure that politics doesn’t come into the picture. I don’t like it and I won’t allow it," he declared.

Last April, Nokia announced its acquisition of Alcatel-Lucent for 15.6 billion euros in an all-stock deal aimed at strengthening the company's position in the telecom equipment market.

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