Nokia has signed a €500 million loan transaction with the European Investment Bank (EIB), supported by key Investment Plan for Europe element, the European Fund for Strategic Investments (EFSI). The company plans to use the funding to further accelerate the research and development of 5G technology.
Also known as the Juncker Plan, the Investment Plan for Europe focuses on strengthening European investments to stimulate jobs and growth. The EFSI is the central pillar of the plan, providing a first loss guarantee, so that the EIB can invest in more and sometimes riskier, projects. The loan, which extends Nokia's debt maturity profile, has an average maturity of approximately five years after disbursement, which can take place at any time during the next 18 months.
Speaking about the funding, EIB vice-president, Alexander Stubb, responsible for lending in Northern Europe, commented: ‘5G is happening fast, faster than most people even expected. It's anticipated that it will enable entirely new business cases, while dramatically enhancing existing wireless applications.’
Nokia CFO Kristian Pullola added: ‘We are pleased to land this financing commitment from the EIB, who shares our view of the revolutionary nature of 5G - and the realisation that this revolution is already underway. This financing bolsters our 5G research efforts and continues the broader momentum we have already seen this year in terms of customer wins and development firsts, supporting our relentless drive to be a true leader in 5G – end-to-end.’
Concluded European Commission vice-president Jyrki Katainen, responsible for jobs, growth, investment and competitiveness: ‘Ensuring that Europe embraces and benefits from new technologies requires sustained investment. That is where the Investment Plan for Europe can play a crucial role. I am delighted that, with today's agreement, the Plan is contributing to Nokia's research and development activities across multiple European countries to advance the development of 5G technology.’
Nokia has also been making news when it comes to fibre roll out in the UK, after it was selected – alongside Huawei – earlier this year by Openreach to help deliver rollout of fibre to the premises (FTTP) technology to approximately three million homes and businesses by the end of 2020 (see Huawei and Nokia help Openreach deliver ‘fibre first’).