The move comes amid intense scrutiny of Nokia’s cash
position after it burned through liquidity at a very fast pace around the turn
of the year. In the second quarter of this year, its net cash position fell 14
per cent to €4.2bn due entirely to a dividend payment to investors. “We have ample cash
resources to do what we need. But to cut costs and conserve cash we are looking
at all possible options with no stones being left unturned. One of those is the
possibility of selling our headquarters,” Nokia said. Nokia moved out of central Helsinki in 1996 to a
striking glass and steel building on the edge of the sea in the neighbouring
town of Espoo that it expanded in 2001 to its current size. It pointed to other
Finnish companies that had sold and leased back
their headquarters in recent years, including Kone, Stora Enso and UPM-Kymmene.
their headquarters in recent years, including Kone, Stora Enso and UPM-Kymmene.
Nokia has sent documents out to interested parties
but a sale is not imminent. It had earlier said, when it announced its
second-quarter results, that it was looking to sell its property holdings
around the world. “We are not a real estate company and we would rather invest
in our core operations,” it said. But
analysts remain concerned about the level of cash burn as the company fights
for survival following a series of disappointing product launches in an attempt
to compete with Apple’s iPhone and companies using Google’s Android platform.
Credit analysts stress that technology companies
can go bust with positive cash balances, pointing to Nortel, which had several
billions of dollars in cash on its balance sheet when it went bankrupt in 2009.
Standard & Poor’s, the credit rating agency, said in August when it
downgraded Nokia again that it expected the group to end this year with less
than €3bn in net cash.
Nokia in return has touted its ability to squeeze
cash out of its business, using advanced royalty payments on some of its
patents to avoid a worse cash burn in the second quarter. It also has an
undrawn credit line of €1.5bn, which is available until March 2016.
Analysts have speculated that Nokia will soon have
to cut its dividend to protect its remaining cash. Its first debt repayment is
for €1.25bn in early 2014