Despite a relatively successful start — especially in the U.S. — Nokia’s Lumia devices don’t seem to be doing enough to turn the Finnish company’s fortunes around. Its credit rating continues to fall, and after a dismiss first quarter, market intelligence firm Standard & Poors downgraded Nokia’s bonds to “junk status.”
Nokia is now hoping to raise some cash by selling its luxury Vertu brand, according to the Financial Times. It is said to be in “advanced talks” with private equity firm Permira over a deal that could be worth around €200 million (approx. $265 million).
Private equity firm EQT has also been in talks with the company about buying Vertu, according to the report. However, sources familiar with the situation report that these talks are “not progressing” at this stage.
The U.K.-based brand, which sells luxury cellphones for tens of thousands of dollars to anyone who can afford one, was started by Nokia back in 1998. Vertu handsets are often built from precious metals and then encrusted in expensive stones. The devices are hooked up to an on-demand concierge service which owners can use to book restaurants.
Some handsets, which feature crystal displays and sapphire keys, can sell for more than $325,700. (And you thought the iPhone 4S was expensive!) Annual revenue for the Vertu business has been estimated at around €200 million to €300 million (approx. $488 million).
Nokia’s decision to sell Vertu is reportedly part of its plan to offload devisions that aren’t part of its core business and focus on its Windows Phone-powered Lumia platform.
Do you think that Nokia needs to offload its Vertu brand to turn things around?
[via Financial Times]