Nokia Appoints Rajeev Suri as CEO

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 [e-mail]

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