Nokia Mobile Phones Makes Equity Investment in Geoworks
Companies to Develop Next Generation Personal Wireless ProductsALAMEDA, Calif. (February 15, 1995) -- Geoworks (NASDAQ/NMS: GWRX) and Nokia Mobile Phones, a business group of the Finland-based Nokia Group (NYSE: NOK, pr), today announced that Nokia has made a $7.5 million equity investment in the consumer computing software firm. The investment represents the purchase of one million new shares of Geoworks' common stock at a price of $7.50 a share and gives Nokia an 8.95 percent stake in Geoworks.
Nokia's investment, upon satisfaction of closing conditions, increases the number of Geoworks' shares outstanding to approximately 11.2 million shares. In addition, a Nokia representative will be nominated to the board of directors. Nokia is Europe's largest cellular telephone manufacturer and a major supplier worldwide.
The new business alliance between the companies allows Nokia to use Geoworks' software technology for advanced phones and applications for use in automobiles. Nokia will design products based on GEOS, a graphical operating system platform created by Geoworks for use in portable computing environments and intelligent communications products such as "smart phones."
"The Geoworks vision of affordable, high-performance consumer computing devices coincides with the Nokia vision of various wireless multimedia terminals for different consumer segments," said Reijo Paajanen, vice president, Cellular Data, Nokia Mobile Phones. "After a review of all available options, we found Geoworks was the only company that provided a cost-competitive software solution which make efficient use of memory, an existing processor platform and a proven operating system. Moreover, Nokia values the entrepreneurial spirit of Geoworks and its willingness to listen to the customer's needs."
GEOS, an advanced graphical operating system, requires limited hardware resources. This enables hardware manufacturers to deliver products on an open platform capable of long battery life without sacrificing functionality. In addition, Geoworks' patented user interface technology provides the unique ability for partners to customize the look and feel of their products for optimal ease-of-use and increased product differentiation.
"By partnering with Nokia, a company with a great track record of bringing cellular phones into consumer electronics markets, we will deliver our software for a new class of 'smart phone' products that combine the best of cellular phone technology and data communications for users around the world," said Gordon Mayer, president and chief executive officer of Geoworks.
According to industry analysts, there are 55 million cellular phones in use globally with some 25 million being used by American subscribers. The market is estimated to be growing annually by at least 40 percent. The emergence of the enhanced class of digital communications products will combine the best of cellular phone and wireless data capabilities and will capitalize on the growing popularity of cellular communications and the emerging Personal Communications Services (PCS) networks.
With today's announcement, Nokia joins equity investors Hewlett-Packard Company and Novell, Inc. who each made a $4.5 million equity investment in Geoworks in March 1994. Geoworks partners that have adopted GEOS technology include an impressive list of leading manufacturers such as Brother International Corp., Canon Business Machines, Casio Computer Co., Hewlett-Packard Company, IBM/Eduquest, Sharp Electronics Corporation and Toshiba Corporation. In addition, the company has agreements with communications providers such as America Online and CompuServe, Inc.
Geoworks develops and markets operating systems and application software for the consumer computing device (CCD) market. CCDs include mobile devices, such as smart phones, mobile companions, PDAs and organizers.
Finland-based Nokia Group is a leading global telecommunications and electronics equipment supplier, with 1993 worldwide sales in excess of $4.3 billion. Nokia is the world's second largest manufacturer of cellular phones, with sales in almost 100 countries. It is also a leading supplier of cellular telephone systems and network infrastructure equipment, with systems in place in some 40 countries.