[otoburb]

As per the article, with italic emphases mine: "A year ago, Nokia sold its struggling handset business to Microsoft Corp. This week's media reports were focused on the idea that Nokia may buy Alcatel-Lucent's mobile networks arm, which would be a simpler deal to carry out than a full combination but would leave the French firm much smaller."

In short, Nokia sold their iconic and consumer-facing handset division (what they used to call their "Device & Services Business"[1]) to Microsoft in November 2013, although the sale didn't officially complete until April 2014. However, after the divestiture Nokia still existed as a corporate entity with the majority (over 90%) of the revenues coming from their Nokia Solutions and Networks division (NSN) [2]. NSN and ALU's mobile networks division are direct competitors in the telecommunication equipment and software market, so a potential merger makes sense depending on which side of the table you're on.

[1] http://company.nokia.com/en/news/press-releases/2014/04/25/n...

[2] http://www.economist.com/news/business/21590363-after-sale-i...

[Spearchucker]

It does indeed make sense for Nokia. Specially in the context of them considering selling off Here maps. Seems there's a sentiment at Nokia to focus on their core business to regain shareholder confidence(and hopefully, I suppose, improve the junk status of their stock).

[digi_owl]

And both Nokia and A-L seems to be taking a beating for Huawei.