STOCKHOLM-- Nokia Corp. on Tuesday named mobile network veteran
Rajeev Suri as its next chief executive and said it would
distribute an approximately 1 billion euro ($1.4 billion) special
dividend and initiate a share-repurchase program in an effort to
return to investment grade.
The financial moves follow the sale of the company's handset
unit to Microsoft Corp.
Mr. Suri, an electronics and telecom engineer who has headed
Nokia's mobile network unit since 2009, had been widely expected to
be named to the top post. He will succeed Risto Siilasmaa, Nokia's
chairman, who served as an interim CEO of the Finnish company since
September, when Microsoft unveiled its plans to buy Nokia's handset
business.
Stephen Elop had been running Nokia when the handset business
was sold, but stepped down to take a senior job with Microsoft.
Relieved of its loss-making phone operation, Nokia said its
"financial position and earnings profile have both improved
significantly" and that it therefore would distribute extra cash to
shareholders and buy back shares as part of a "capital structure
optimization program."
On top of least EUR800 million worth of ordinary dividends for
2013 and 2014, Nokia said it plans to distribute a special dividend
to shareholders of EUR0.26 per share, which equates to a cash
distribution of around EUR1 billion. It will also initiate a
EUR1.25 billion share repurchase program.
In a statement, Nokia's financial chief Timo Ihamuotila said the
initiatives are part of Nokia's longer-term ambition to "return to
an investment grade credit rating."
Nokia ended the first quarter this year with EUR2.1 billion in
net cash, before the sale of its handset unit to Microsoft was
completed. Had the transfer been completed before the end of the
first quarter, Nokia said its cash position would have been at
EUR7.1 billion.
Nokia will be releasing its first quarter earnings report later
on Tuesday.
Write to Sven Grundberg at sven.grundberg@wsj.com
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