Nokia sells Operator Branded Messaging business for $25m

Nokia has sold its Operator Branded Messaging (OBM) business to UK-based mobile messaging firm Synchronica in a deal worth $25m.

As part of the agreement, Synchronica will acquire Nokia's email, instant messaging, social networking gateway, client software and associated patents.

This technology will be merged with Synchronica's Mobile Gateway system, and the firm will continue to operate Nokia's messaging technology.

Additionally, Synchronica will acquire 10 operator contracts with high-profile North American telecoms firms including AT&T, Sprint, Verizon and T-Mobile. 

Over six million users will be added to Synchronica's customer base, and approximately 250 employees will move from Nokia to the firm.

Synchronica has also signed a three-year deal to support Nokia's Messaging Service, which will be worth $18.2m over the next 18 months, explained Carsten Brinkschulte, chief executive of Synchronica.

"This is our biggest acquisition to date and the software we are acquiring will be available on hundreds of millions of Series 40 and Symbian smartphone devices," he told V3.co.uk.

"This is an important step as it will help us expand our business from emerging markets to areas such as the US and UK."

Synchronica said it had received financial information from Nokia confirming that the business was profitable, and that the move is ideally suited to the company's strategy.

"It is not considered to be significant to Nokia, and as a means of aligning with recent changes to its corporate strategy Nokia elected to review its mobile messaging strategy," the firm said in a statement.

"The OBM customer base is highly complementary to Synchronica's presence in emerging markets and presents a unique opportunity to transform its geographic scope by entering the North American market."

Nokia confirmed that the sale represented a continuation of its move to shed unwanted assets to help refocus and streamline its business.

"This ongoing restructure is part of a wider closure of online shops which simplifies our channel structures and focuses our resources towards our local retail partners and operator stores," the firm said in a statement.

The sale of the division will bring a much needed cash injection to Nokia, which is also set to receive a lump sum payment from Apple in the region of €420m as part of a patent settlement dispute.

The ailing manufacturer has also been trying to sell a major stake in Nokia Siemens Networks, although investors have been unwilling to get involved.