Nokia Commences Strategic Share Buyback to Offset Dilution

Nokia Initiates Strategic Share Buyback Program

Nokia Oyj has recently announced the start of a share buyback initiative designed to mitigate the potential dilution that may arise from its acquisition of Infinera Corporation. This program is a strategic move to preserve shareholder value as it integrates Infinera into its operations.

Details of the Buyback Program

Planned to begin no earlier than November 25, 2024, the buyback program is set to conclude by December 31, 2025, at the latest. Nokia has allocated up to €900 million to repurchase as many as 150 million shares, which accounts for around 3% of the company’s total shares. This allocation signals Nokia’s commitment to enhancing its stock value amidst the expansion.

Aim of the Buyback

The primary goal of this buyback initiative is to decrease the company's equity and offset the dilution resulting from issuing new shares to Infinera's shareholders as well as from Infinera’s existing share-based incentive plans. By repurchasing these shares, Nokia plans to cancel them in line with the objectives of this initiative, thereby enhancing the overall value of the remaining shares held by existing investors.

Authorization and Management of the Program

The board of directors for Nokia received the authorization to proceed with share buybacks during the annual general meeting held on April 3, 2024. Acquisitions will be carried out on the Nasdaq Helsinki regulated market and other recognized multilateral trading facilities, reflecting the company’s focused approach to stock market activity.

Independent Management by External Broker

An external broker has been appointed to manage this buyback program independently. This independent management ensures that trading decisions are made without influence from Nokia, adhering to best practices in corporate governance. The buybacks will conform to the safe harbor provisions outlined in Article 5 of the EU Market Abuse Regulation (EU No 596/2014), which provides guidelines on price and volume restrictions during buyback operations.

Market Rate Considerations

The price at which Nokia intends to purchase shares will align with the prevailing market rates at the time of acquisition. In a remarkable move towards transparency and agility, Nokia retains the option to terminate the buyback program ahead of the scheduled completion date. Should this occur, the decision will be communicated promptly through a stock exchange release, ensuring that shareholders are kept informed.

About Nokia’s Vision and Innovations

Nokia is well-regarded as a leading global technology company, recognized for its innovative solutions that connect the world. With a strong emphasis on fixed, mobile, and cloud service networks, Nokia leverages its extensive intellectual property and the advanced research capabilities of Nokia Bell Labs. These attributes position Nokia as a trailblazer in network innovation and technology.

Frequently Asked Questions

What is the purpose of Nokia's share buyback program?

The buyback program aims to mitigate the dilution of shares resulting from the acquisition of Infinera by repurchasing existing shares and enhancing shareholder value.

When will the buyback program start and end?

The program is set to commence on or after November 25, 2024, and is expected to conclude by December 31, 2025.

How much money has Nokia allocated for the buyback?

Nokia has designated up to €900 million for the repurchase of shares during this buyback initiative.

Who is managing the share buyback operations?

An external broker has been appointed to manage the share buybacks independently, ensuring unbiased execution of the program.

What are the compliance measures for the buyback?

Nokia’s buyback program will comply with the safe harbor provisions of the EU Market Abuse Regulation, which dictates the conditions regarding price and volume of transactions.

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