FILE PHOTO: The Alcatel-Lucent logo is seen in Calais, France, 7 September 2016. REUTERS/Charles Platiau
HELSINKI (Reuters) – the Finnish network equipment maker Nokia said on Friday it was looking for transactions on the former French rival Alcatel-Lucent acquired in 2016, after a report of potential compliance issues on the unit to the US authorities.
Shares fell 8.2 percent by 1127 GMT, on track for worst day since October, 2017 and the bottom of the pan-European STOXX 600 index.
“The last night comment on possible fines arising from the business transactions of Alcatel-Lucent’s hurting the stock, the market is really sensitive about the Nokia these days,” said Kimmo Stenvall, an analyst at the Markets.
Nokia said that certain practices relating to compliance issues at the former Alcatel-Lucent company had raised its concerns during the integration process.
“In order to ensure full compliance we are now critical of certain transactions in the former Alcatel-Lucent business and although this study is in a relatively early stage, out of an abundance of caution and in the spirit of transparency, Nokia has contacted the relevant regulatory authorities about this review, Nokia said in a statement by e-mail to Reuters.
Nokia said it had voluntarily reported the matter to the relevant regulatory authorities, and it was the cooperation with the authorities to resolve the matter.
“The resolution of this matter could result in a possible criminal or civil penalties, including the possibility of fines, which could have a material adverse effect on our business, the brand, the reputation and financial position,” he said in a filing with the U.S. Securities and Exchange Commission.
Reporting by Anne Kauranen and Tarmo Virki, editing by Louise Heavens