HELSINKI (Reuters) - Nokia (NOKIA.HE) said it plans to sell its small digital health business, including activity trackers and smartwatches, to a co-founder of the venture.
Digital health was one of the areas Nokia had been counting on for future growth opportunities amid a tough market for its mainstay telecom network equipment business. But the business failed to meet growth expectations, an internal memo showed in February after Nokia started a strategic review of it.
On Wednesday the Finnish company said it had entered into exclusive negotiations with Eric Carreel, co-founder and former chairman of the digital health business, Withings, a French company Nokia bought in 2016 as its first move into the market.
“The transaction is subject to terms agreed in the negotiations and completion of the information consultation with the Works Council of Nokia Technologies (France) S.A., with the deal expected to close in late Q2 2018,” Nokia said in a statement. It did not give an indication of the sale price.
Nokia paid 170 million euros ($204 million) for Withings but last year wrote down 141 million euros of goodwill on it.
Nokia’s total sales fell 3 percent last year to around 23 billion euros.
It shares were flat on Wednesday. They have fallen 7 percent in the past 12 months on weak global demand for network equipment. ($1 = 0.8334 euros)
Reporting by Jussi Rosendahl, editing by Terje Solsvik and Susan Fenton