Nokia anticipates saving €900 million on operating costs by 2019 through its takeover of rival telecoms provider Alcatel-Lucent.
The €15.9 billion acquisition announced today highlighted a number of areas for synergies between the two businesses.
These included procurement being handed the expanded purchasing requirements of the combined business, and a reduction of overheads in manufacturing and supply chain, real estate, IT and general expenses.
“We have hugely complementary technologies and the comprehensive portfolio necessary to enable the internet of things and transition to the cloud,” said Nokia CEO Rajeev Suri.
“I firmly believe that this is the right deal, with the right logic, at the right time.”
The deal, which is subject to approval from Nokia shareholders and regulators in France and the US, is expected to be completed in the first half of 2016.
Microsoft purchased Nokia’s mobile phone division for €5.4 billion in September 2013.