Slide 1: Creating an innovation leader in next generation technology and services for an IP connected world
April 15, 2015 Creating an innovation leader in next generation technology and services for an IP connected world 1
Slide 2: Disclaimer: Forward-looking statements
Disclaimer: Forward-looking statements This presentation contains forward-looking statements that reflect Nokia’s and Alcatel-Lucent’s current expectations and views of future events and developments. Some of these forward-looking statements can be identified by terms and phrases such as “anticipate
Slide 3: Agenda
Agenda Page Creating an innovation leader 3 Compelling strategic rationale 8 Delivering significant value 16 Next steps and concluding remarks 26 3
Slide 4: Creating an innovation leader in next generation network technology and services
Creating an innovation leader in next generation network technology and services Consumers Consumers Operators Operators Looking to deliver quad-play solutions Looking to access data everywhere Demand converged technology of Mobile and Demand seamless connectivity Fixed broadband, IP routing, Core n
Slide 5: Transformational combination driving significant shareholder value
Transformational combination driving significant shareholder value • End-to-end portfolio scope and scale player with leading global positions across Strategically products and services compelling • Complementary offerings, customers and geographic footprint • Innovation powerhouse with significant
Slide 6: Key transaction highlights
Key transaction highlights • Public exchange offer by Nokia for 100% of Alcatel-Lucent shares and convertible bonds Transaction - Public exchange offer to be filed in France and the United States structure - Offer for Alcatel-Lucent shares (including ADS) and convertible bonds • Combined market capi
Slide 7: Proposed company structure and governance
Proposed company structure and governance Group name and • Nokia (group and brand) listing • Listed on Euronext Paris, Nasdaq Helsinki and NYSE (ADS) • Headquarters in Espoo, Finland Headquarters & • Key locations across Europe, United States, China and Asia-Pacific key locations • Creation of a 5G
Slide 8: Agenda
Agenda Page Creating an innovation leader 3 Compelling strategic rationale 8 Delivering significant value 16 Next steps and concluding remarks 26 8
Slide 9: Scope to create seamless connectivity for people and things wherever they are
Scope to create seamless connectivity for people and things wherever they are Requirement for real- Capacity for exponential Enable seamless, Intelligent, adaptive time and resilience growth in usage ubiquitous access service 9
Slide 10: Market context – changing industry paradigms
Market context – changing industry paradigms Equipment vendors – what 1 will it take to win? • Telcos around the world consolidating both in-country and globally Operator consolidation • Increased network sharing activities Scale and breadth of technology capabilities • Expanding to quad-play 2 • Ub
Slide 11: End-to-end portfolio with strong positions in key growth areas
End-to-end portfolio with strong positions in key growth areas of fixed-mobile convergence, IP routing, Cloud and Analytics Market leading portfolio scope and scale Market share, 2014A Fixed LTE #1 broadband #1 IP routing1 #2 VDSL #1 (53%)2 30% 30% 29% 27% 39% Edge #2 (27%) 23% 13% 21% 20% Combined
Slide 12: A new leader with scale to win in carrier-grade telecoms networking and IP licensing
A new leader with scale to win in carrier-grade telecoms networking and IP licensing Carrier revenues (FY2014A) €bn 25.1 25.0 23.5 9.0 7.1 3.1 2.3 2 3 4 5 6 7 1 Source: Company information FX applied: SEK/EUR 0.1099, CNY/EUR 0.1224, KRW/EUR 0.0007 1 Ericsson Group revenues 2014A; 2 Based on Nokia Ne
Slide 13: Complementary product portfolios
Complementary product portfolios 2014A revenues: Combined 2014A revenues: €12.7bn €13.2bn Expanded addressable 5% market with improved 3% 1% growth profile 8% 16% 36% Comprehensive end-to- 11% end portfolio scope and 88% scale 16% 18% 54% Mobile broadband Products, software and Networks < 46% Global
Slide 14: Complementary geographic presence strengthening global footprint
Complementary geographic presence strengthening global footprint 2014A revenues, €bn Combined 7.7 6.9 3.0 4.7 5.8 1.3 2.8 2.1 1.8 3.9 1.3 3.4 1.0 0.7 1.9 1.4 1.1 1.1 North Europe Asia-Pacific / Greater Middle East & Latin America America Japan / India China Africa Nokia Group Alcatel-Lucent Group Co
Slide 15: Next logical step of successful transformations
Next logical step of successful transformations € € 10 Acquired Siemens stake 5 Shift Plan transformation 9 in the NSN joint venture well underway 4 8 Sale of Devices & Build joint Rebuilt capital base through 7 Services transformational refinancings and divestments 3 future with 6 Establish
Slide 16: Agenda
Agenda Page Creating an innovation leader 3 Compelling strategic rationale 8 Delivering significant value 16 Next steps and concluding remarks 26 16
Slide 17: Delivering value for key stakeholders
Delivering value for key stakeholders Comprehensive end-to-end portfolio of products, software and services to enable future connectivity needs Partner of choice for Enhanced innovation capability and extraordinary R&D Customers engine under the iconic Bell Labs brand 5G / convergent / IP / clou
Slide 18: Customers: Comprehensive end-to-end portfolio scope and scale
Customers: Comprehensive end-to-end portfolio scope and scale Connectivity of the future Broadband IP & Cloud, Services HERE TECH Transport Analytics Mobile IP Routing Core / Applications / Attached Services Automotive Patent licensing • SRAN, LTE • Edge Routing Platforms • Network • 5G • Core Routi
Slide 19: Customers: Extraordinary innovation capabilities
Customers: Extraordinary innovation capabilities Industry leading R&D platform – BellLabs and Global R&D capabilities FutureWorks R&D spend (€bn) R&D / Innovation centres: Nokia Alcatel-Lucent Both 5.0 Combined 4.7 1 4.7 4.0 2.5 2.2 1.1 >40,000 R&D employees 0.8 Source: Company information 19 FX app
Slide 20: Investors: Significant and actionable synergies potential
Investors: Significant and actionable synergies potential • Product and services overlap • Sales force / resources optimization Identified operating Approx. €900m cost savings • Supply chain / procurement scale (annual achieved in 20191) • Overhead costs in real estate, IT, and overall G&A, includin
Slide 21: Investors: Enhanced financial position and superior shareholder value creation
Investors: Enhanced financial position and superior shareholder value creation Combined €bn PF 2014A 2014A 2014A (illustrative aggregation) • EPS accretive in 2017 (Non- Net sales 12.7 13.2 25.9 IFRS basis)1,2 • Illustrative non-IFRS Non-IFRS operating profit1 1.6 0.6 2.3 operating profit margin wit
Slide 22: Investors: Attractive offer for Alcatel-Lucent shareholders
Investors: Attractive offer for Alcatel-Lucent shareholders Offer premia Offer value calculations (millions, except per share) Premium to shareholders Offer exchange ratio 0.550 Fully diluted premium Offer value per share € 4.27 34% (based on Nokia April 13 closing price of €7.77) Current Alcatel-Lu
Slide 23: Investors: Robust capital structure
Investors: Robust capital structure • Strong balance sheet, with combined net cash at end of 2014 of €7.4bn, assuming conversion of all Nokia and Alcatel-Lucent convertible bonds Capital structure • Maintain long-term target to re-establish an investment grade credit rating • Intention to retain sig
Slide 24: Employees: Commitment to foster employee opportunities
Employees: Commitment to foster employee opportunities Leading end-to-end portfolio Best in class environment for learning and development Forefront of innovation, developing cutting-edge technologies Performance-driven ethos and culture Multi-cultural environment and entrepreneurial spirit 24
Slide 25: Our commitment to France
Our commitment to France • Nokia intends to maintain employment in France that is consistent with Alcatel-Lucent’s Employment end-2015 Shift Plan commitments commitments • Increase long-term R&D employment • Two major technology sites Key sites / Centers • Operational hubs located in France providin
Slide 26: Agenda
Agenda Page Creating an innovation leader 3 Compelling strategic rationale 8 Delivering significant value 16 Next steps and concluding remarks 26 26
Slide 27: Transaction timeline and key events
Transaction timeline and key events Offer period Announcement Review period Offer Nokia EGM Expected closing Public announcement Regulatory review and Offer to be launched EGM expected to take Closing of transaction of transaction other transaction after receipt of place during the offer once all mi
Slide 28: Building blocks in place for success
Building blocks in place for success Clearly defined leadership Deep culture of innovation and strikingly common vision for the future Recent integration experience on both sides invaluable lessons learnt Track-record of execution Open interfaces in LTE and cloud / core allow more rapid
Slide 29: A transformational combination driving value for all stakeholders
A transformational combination driving value for all stakeholders Unique opportunity to create a new European champion and a global leader in ultra-broadband, IP networking and cloud applications A leading Finnish company and a leading French company join forces in a natural partnership to lead crea
Slide 30: NOKIA Alcatel-Lucent @
30 A NOKIA Alcatel-Lucent @