by CIO Staff

Nokia, Sanyo Abandon Plan to Merge CDMA Units

Jun 22, 20062 mins
IT Leadership

Nokia and Sanyo Electric have canceled plans to merge their code division multiple access (CDMA) handset divisions, the two companies said Thursday.

The companies said they are calling off the merger plan after extensive analysis concluded that it is more beneficial to pursue other options individually for the respective CDMA handset businesses.

They first announced the merger plan in February, with a view to capturing the top share of the global CDMA market. The companies had complementary product lines: Sanyo had been selling mainly mid- to high-end handsets in the United States and Japan, while Nokia had been concentrating its CDMA efforts in developing markets.

The combined company would have been a much stronger competitor to market leaders Samsung Electronics and LG Electronics. Nokia and Sanyo would have had a combined market share of 20.6 percent, based on 2005 estimates, making it a tie with Samsung.

The companies had promised a definitive agreement in the second quarter, which ends in about a week, and the new company was supposed to start operating in the third quarter.

Now that Nokia and Sanyo have abandoned the merger, they will announce their future plans in due course, they said in a statement.

-Martyn Williams, IDG News Service (Tokyo Bureau)

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