Loan to Nokia follows $300 million in financing for Ericsson
The Investment Plan for Europe, also called the Juncker Plan after European Commission President Jean-Claud Juncker, is designed to jumpstart private investment in European business development by providing public funds via the nonprofit European Investment Bank. Technological advancement, including around 5G cellular technologies, is a major goal of the Juncker Plan and, as such, the EIB has actively engaged tech interests, including network infrastructure giants Nokia and Ericsson.
Today Nokia said it has received a $580 million loan from the EIB meant to further R&D related to 5G, which EIB Vice President Alexander Stubb described as “happening fast, faster than most people even expected. It’s anticipated that it will enable entirely new business cases, while dramatically enhancing wireless applications. I think bringing 5G to the market will definitely improve people’s lives.”
Across its business units, Nokia and Ericsson both offer end-to-end 5G portfolios, and both companies are engaged with operators throughout Europe and the world on commercializing next-generation cellular networks and services.
Nokia Chief Financial Officer Kristian Pullola said the money “bolsters our 5G research efforts and continues the broader momentum we have already seen this year in terms of customer wins and development first, supporting our relentless drive to be a true leader in 5G–end-to-end.”
In May, the EIB agreed to loan Ericsson about $300 million, which followed a January loan from the Nordic Investment Bank of $220 million and another $150 million from AB Svensk Exportkredit, a state-owned financier.
According to terms of the loan from the EIB, the $291.6 million credit facility will mature five years after disbursement. Stubb, at the time, pointed to how Ericsson’s work fits into larger European Union goals. “The development of 5G technology is easily one of the most important initiatives for the telecom industry in the coming years. Ericsson has been one of the defining contributors to what mobile telephony is today and I think we can only be proud to support this. Apart from supporting European technology, this project will also make sure that thousands of highly-skilled jobs will stay in the EU.”
According to the company, it spent around $4 billion on R&D in 2017.
