Nokia Bond Risks Endure After Dividends Cut: Corporate Finance
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Nokia Oyj’s tendency to burn through cash faster than any of its rivals is putting bondholders at risk even after the smartphone maker bolstered its balance sheet by skipping a dividend for the first time in 143 years.
Societe Generale SA recommends investors sell Nokia’s 500 million euros ($673 million) of 6.75 percent bonds due in 2019 and buy five-year credit-default swaps that insure against the Finnish company missing debt payments. While Nokia posted its first profit since early 2011 last week after Chief Executive Officer Stephen Elop cut jobs and closed factories, it also had a seventh straight drop in quarterly revenue.