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Mobile telecoms equipment maker Nokia Siemens Networks (NSN) has decided to hive off its optical fiber networks unit to private equity firm Marlin Equity Partners in a bid to focus solely on mobile broadband. The Finnish-German joint venture has not revealed the financial details of the deal but stated that it would be completed in the first quarter of 2013.

NSN reported record profits in the third quarter, aided by sales of equipment for fourth-generation high-speed LTE networks in Japan and Korea. However, the JV partners Nokia Oyj and Siemens AG suffered significant losses in the earlier quarters which perhaps blunted their interest to stay invested in the optical fiber networks business. To cut costs, the company is reportedly laying off a quarter of its staff apart from selling some of its product lines.

"During 2012 Nokia Siemens Networks has made tremendous progress in the transformation of our company to being the world's mobile broadband specialist," NSN Chief Executive Officer Rajeev Suri said in a company release. "Our strategic focus on our core markets has enabled us to concentrate our energy and investment in areas such as LTE where we have strengthened our global leadership position. This transaction builds on that momentum and aims to provide a new home for the Optical Networks business with the focus, resources and strategic flexibility to address the opportunities in the optical market."

Marlin Equity Partners on its part intends to build "an industry leader in the fragmented optical networking sector" through its acquisition of the NSN unit.

"We are making a major commitment to this sector, and have significant capital under management that we intend to use as a catalyst for consolidation," Co-founder and partner at Marlin Equity Partners. Nick Kaiser, said.

The new optical company will be headquartered in Munich, Germany and will be led by its existing management team with Herbert Merz nominated as chief executive officer.

"This transaction will give us the opportunity to build a long-term leader in optical and the strategic flexibility to be proactive in the market. Marlin is the ideal owner for this business as it is a long-term investor with an extensive and successful track record in our industry and direct experience of working with some of our customers," Merz said.