To improve foothold in U.S. and Japan, Nokia Siemens buys Motorola's wireless business

European telecommunications giant Nokia-Siemens announced today that it will acquire the majority of Motorola Inc's wireless network infrastructure business for $1.2 billion.

Nokia Siemens announced this morning that it will acquire Motorola's GSM and CDMA infrastructure business, while Motorola will keep its iDEN business, potentially all of its intellectual property related to the wireless network infrastructure business, and "other selected assets."

Motorola's wireless infrastructure products include Base Stations for CDMA 1X and EV-DO Rev A, a significant portfolio of GSM equipment, such as Transciever Stations, Base Station Controllers, and radio access network Controllers; UMTS HSPA radio network controllers and "Node B" solutions (similar to base transciever stations.)

One of the most promising aspects of Motorola's infrastructure business, however, is in 4G networking. Not only was Motorola a major supplier in U.S. WiMAX network, but it has 41 contracts in 21 other countries as well. In addition, Motorola has also been the largest contributer to the development of LTE's radio network standards.

Nokia Siemens Networks expects to gain new relationships with more than 50 worldwide network operators as a result of this acquisition and says it will strengthen its position with China Mobile, Clearwire, KDDI, Sprint, Verizon Wireless and Vodafone.

Motorola began discussing a spin-off of its consumer handset business in 2008, but the company has enjoyed a resurgence in popularity due to its total support for Google's Android mobile operating system, and the planned spinoff was pushed back until after 2011. The $1.2 billion Motorola expects from the deal could be split between Motorola's two businesses: solutions and mobility, but Motorola will not specify exactly where the capital will go until the end of the year.

The deal is expected to be completed by the end of 2010.