The EU Commission has “unconditionally” approved the $2.3bn acquisition of US-based Infinera by Finnish technology company Nokia.

The commission has found that the merger will not raise competition concerns, as the combined market share of the two companies is considered moderate.

In June 2024, Nokia agreed to acquire Infinera, a provider of open optical networking solutions and advanced optical semiconductors, in a cash and stock deal.

The purchase price of $6.65 per share represents a significant premium over Infinera’s share price as of 26 June 2024.

The merged entity is expected to achieve the necessary scale to enhance its product offerings and more effectively compete with larger rivals.

Following assessment, the Commission concluded that the combined market share of Nokia and Infinera in the supply of optical transport equipment would remain moderate, with sufficient competition in the sector.

The assessment considered both global and European Economic Area markets, as well as specific segments of optical transport equipment based on type and application.

The Commission’s investigation found that several credible competitors would continue to exert competitive pressure on Nokia following the acquisition.

As a result, the transaction was cleared without conditions.

The merged entity is expected to strengthen its in-house capabilities, including digital signal processor development and expertise in silicon photonics, indium phosphide-based materials, and photonic integrated circuit technology.

Nokia’s expanded portfolio will enable it to sell more optical networking equipment to large technology companies such as Amazon, Alphabet, and Microsoft, which are investing heavily in data centre infrastructure to support AI advancements.

Infinera’s strong presence in North America, which accounts for approximately 60% of its sales, is expected to enhance Nokia’s market position in the region and complement its operations in APAC, EMEA, and Latin America.