Beleaguered Finnish phone manufacturer Nokia is expected to raise 750 million euros (£611 million) by offering senior unsecured convertible bonds. This will require the mobile firm to borrow against its reserves, with the proceeds being used to strengthen its cash position and to service debts.
Last week saw Nokia post a third quarter drop in its cash position from £3.4 billion to £2.8 billion, as it steps up its investments in the Windows Phone 8 operating system while its global revenues decline. The quarterly findings add further momentum to the company's current downward trend as it was its sixth straight quarterly loss.
It has been reported that Nokia’s bonds will be rated at 4.25 per cent and five per cent per annum, with the bonds' initial 2017 conversion expected to be set at 28 - 33 per cent above the average Nokia shares price between launch and pricing of the offering.
Nokia hopes to reverse its fortunes with the release of a new range of Lumia smartphones following the 29 October launch of Windows Phone 8, but the Finnish company, which at one time was the largest phone manufacturer in the world, has a long road ahead in its bid to reclaim market share from Apple and Samsung.